Cardinal Point’s VP and partner Terry Ritchie joined host Jason Periera on his podcast to discuss recent developments around financial planning issues for Americans living in Canada and Canadians investing in the US.
Terry is Jason’s “go-to guru on all things cross-border,” and, like many of CP’s wealth managers, he has the firsthand knowledge that comes from living in both countries. Among the current areas of concern that Terry discusses: inflation and how it affects planning; how where you might die affects estate tax liabilities; how Americans moving to Canada need to be prepared for a more intrusive Canada Revenue Agency (CRA) than the IRS would ever be.
For Americans in Canada, added US compliance rules apply even for opening Canadian bank accounts, Tax-free Savings Accounts (TFSA) and other savings plans. Regulations around these rules are in flux, requiring qualified advice. An American selling a home in Canada cannot use a foreign tax credit and may face significant capital gains tax, a very unwelcome surprise for the unprepared. For Canadian snowbirds investing in the US, there will be questions around how best to own property—should it be as a trust, a corporation, jointly with a spouse? CP has a blog article specifically about this. If such a property is rented out, more considerations come into play. There are proposed changes to US estate tax regulations and filing requirements that a prudent Canadian investing in the US should be aware of. If you see yourself as one of these people and want to know more, check out the podcast here.