• First, We will arrange an initial meeting, discuss your tax situations and review your prior year tax return if it's first time service, to determine tax services you need.
• You sign an engagement letter that will outline a list of services to be performed as well as your total cost.
• We prepare a detailed information requirement list to assist you to organize and prepare tax information.
• After we receive majority of your tax information, we start working on your return. You may still have some outstanding information to be provided later. Our regular turnaround time is 7 business days from the date you provide all required documents.
• We complete your return and send you a request for payment.
• After the payment is processed, we will release a tax return for your review.
• We will answer any questions that you might have. Also We will discuss tax saving strategy that you may take going forward.
• After you are happy with the return, We will help you file it.
• We will follow up with you in 3 months to clarify any subsequent tax issues and provide further assistance on tax planning.
The income tax systems of the U.S. and Canada are similar in some general ways, but very different in their details. Here are a few major differences of filing US and Canadian individual tax return.
The U.S. taxes individuals based on citizenship and residency. The U.S. is one of the few countries in the world that taxes its citizens on their worldwide income, whether or not they are physically in the U.S.. Canada taxes only Canadian residents on their worldwide income; non-residents (including Canadian citizens) are taxed by Canada only on certain income from Canadian sources.
The most notable difference is that, in the U.S., married couples can and usually do file a joint return; In Canada, everyone has to file a tax return separately.
Another big difference is that, in the U.S., deductions that can be taken is normally higher than in Canada. Therefore, gross income and taxable income are much closer together in Canada than it is in the U.S.
The last big difference is the deadline of filing tax return and paying tax. In the U.S., the deadline is April 15th; in Canada, it is April 30th. However, the U.S. allows you to file for an extension of time to file until October 15th. You will have to file Form 4868 to ask for the extension, but the extension is automatic. The only catch is that you will have to pay the amount of tax owing by April 15th whether you file for extension or not. It is an extension of time to file, not an extension of time to pay. In Canada, taxpayer has no extension option.
The U.S. also has many special elections that can be made that apply to Canadians moving to or living in the U.S.. These elections are many times obscure and complicated. You should have a cross-border tax specialist to handle both Canadian and U.S. tax return to ensure your tax returns are prepared ordinately and the proper elections are made.
©Yi Yang Canadian, U.S. and International Tax Services