New to US market

[Carlos Rodriguez]

Hi Everyone, my name is Carlos I’m from Toronto, Canada. I’ve invested in property in Vancouver and Toronto but have recently decided to take the plunge into the US. Hoping to connect with fellow Canadians that have invested in Detroit and start making local connections too!

[Kevin Gonzalez]

Hey Carlos,

Welcome to the party! I specialize in working with Canadians that own property down here (I live in Palm Springs, we might be the snowbird capital of the world?). I'm going to reiterate what's already been mentioned above, but I'm going to actually give you examples of why it's relevant to you to find a U.S. tax professional.

1 - You're going to need to file U.S. taxes once you have property down here, there's federal filings, state filings, and sometimes local filings too

2 - Tons of tax treaties between the U.S. and Canada that are easy to miss and can cost you a lot of money (important one with rentals - effectively connected income - if the professional you talk to doesn't know what this is, run away)

3 - The amount of days you spend in the U.S. needs to be tracked and if you go over a threshold, all of your worldwide income could be taxable by the U.S.

4 - Selling real property means up to 15% of your sales proceeds might not be available to you for years (FIRPTA)

5 - Lots of nuance at the state and local levels, which both want to take as much money from you as possible

Main takeaway here is that you should find a U.S. based tax person. I've unfortunately seen too many examples where a Canadian investor trusted their Canadian accountant to handle all the U.S. compliance and it cost them a lot of headaches and money.