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Renouncing your US citizenship: Failed amendment may signal that now is the time to get out!

If you are one of the many US citizens contemplating renouncing your US citizenship, Congress recently sent a fairly clear message that now, as opposed to later, may be the right time to get out of the club. On June 12, 2013, US Senators Jack Reed (D-RI) and Chuck Schumer (D-NY) attempted to add yet another hurdle in the ongoing saga for those individuals looking to renounce their US citizenship in filing an amendment to the immigration reform bill, which attempted to ensure that the US Department of Homeland Security could exclude certain individuals from re-entry into the US forever. The proposed amendment was never voted on in the House and died before reaching the floor.

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Renouncing your US citizenship: Is divorcing Uncle Sam right for you?

The billionaire co-founder of Facebook, the only American member of Monty Python, a Civil Rights Leader with a Ph.D. from Harvard, the founder of Carnival Cruise Lines and owner of the Miami Heat NBA franchise, and arguably the best chess mind to ever live have more in common than you might think. So what do Eduardo Saverin, Terry Gilliam,1 W.E.B. Du Bois, Ted Arison, Bobby Fischer and thousands of U.S. citizens living abroad have in common? The answer is all five have renounced their U.S. citizenship. These individuals are not alone, record numbers of U.S. citizens living in Canada and across the world are in the process of renouncing. Why would a country with a seven to ten year wait list to acquire citizenship have so many citizens headed for the exit? The reason is that three letter word no one likes to hear: TAX.

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Challenges Canadians face when transferring US retirement plans to an RRSP

Canada and the US share many similarities including the longest international border between two countries. Due to the proximity of the two countries, many Canadians find themselves living and working in the US and contributing pre-tax dollars into employer-sponsored retirement plans such as the 401(k) and Individual Retirement Account or IRA (collectively, US-based retirement plans). Once their US employment ends, many Canadian workers returning to their home country must eventually undertake the task of determining what to do with their US-based retirement plans as retirement age draws near (the Canadian retirees).

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Alberta Investor Tax Credit program – even more bad news

On January 17, 2017, I published a blog about the new Alberta Investor Tax Credit programs. For those of you who read my original blog, you’ll know that I was and remain very critical about the new programs. Subsequent to the publishing of my article, some astute readers in the Alberta business and technology industry brought two potential deal killers for the Alberta Investor Tax Credit (AITC) to my attention. A third item, discovered on another read-through of the regulations enacted to implement the many prescribed rules related to the AITC, concerns overreaching Ministerial discretion which, in my view, too easily lends itself to politically motivated denial of the credit. Accordingly, the purpose of this follow-up article is to bring the two deal killer issues to your attention and raise the concern of the overreach that I have subsequently identified.

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Trump’s NAFTA pledge threatens U.S. expats in Canada

Donald Trump infamously called the North American Free Trade Agreement (NAFTA) “the single worst trade deal ever approved by [the United States]”[1] and vowed to withdraw from the deal once elected. This policy was such a core plank of his platform that as soon as it become abundantly clear that Trump would win the U.S. election, the value of Mexican Peso relative to U.S. dollar dropped precipitously under the expectation that the U.S. would likely withdraw from NAFTA.[2]

Since then, much has been written about the potential economic fallout caused by Trumps pledge. However, little has been written about what might happen to Americans who are working in Canada.

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New Alberta Investment Tax Credits – Great for Business or Bureaucrats?

As the new Alberta Investor Tax Credit (“AITC”) and Capital Investment Tax Credit (“CITC”) were making their way through the Alberta Legislature I wrote an article for the Canadian Tax Foundation which appeared in the January 2017 issue of “Tax for the Owner Manager” and can be accessed here. Bill 30, which contains the two credits, became law on December 9, 2016. The draft legislation discussed in my article was only cosmetically changed with 4 amendments accepted at the end of November.

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The 2017 tax crystal ball

Well, it’s that time of year when people start to wind down for the holidays and get ready to spend time with family. For me, I’m not immune to that. I’m very much looking forward to gathering my wife and kids around the fire and the Christmas tree to have a lively discussion about what 2017 might look like in the tax world. Accordingly, consider this short blog a preview of the riveting Moody family holiday discussions. And, yes, my family can’t wait!

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The Twelve Days of Tax Christmas

On the first day of Christmas
my true love sent to me:
an Income Tax Act! (In a Pear Tree)

On the second day of Christmas
my true love sent to me:
Two CRA Notice of Reassessments
and an Income Tax Act! (In a Pear Tree)

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Rethinking your firm’s cross-border tax strategy: The impact of Donald Trump’s business tax reform on Canadian entrepreneurs

It is safe to say President-elect Trump ran a presidential campaign that was bold, filled with fiery rhetoric, and sometimes knew no bounds. For example, at the first presidential debate when asked about paying no personal income tax since 1995, the former Celebrity Apprentice host unequivocally responded, “That makes me smart.” For Canadian entrepreneurs thinking about expanding their business into the US, being smart like Trump means understanding the impact an evolving US tax landscape will have on them and their business.

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An update to the small business deduction rules, and some much-needed flowcharts

It has been more than half a year since the Department of Finance announced proposed amendments to the small business deduction (SBD) rules in section 125 of the Income Tax Act (Act) as part of the 2016 Federal Budget. The Canadian tax community has just started to digest the complexity and reach of these amendments. The draft legislation has only passed First Reading in Parliament (as Bill C-29), but in all likelihood, it will eventually be enacted in its current form since Finance has already made a round of revisions to the draft legislation on October 21, 2016.

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CRA announces flexible treatment for some Canadian investors in LLLP and LLP

At the Canadian Tax Foundation’s 68th Annual Tax Conference held in Calgary from November 27-29, 2016, the Canada Revenue Agency (CRA) orally announced further efforts to ensure fair treatment for Canadians impacted by the May 26, 2016, announcement that US limited liability limited partnerships (LLLPs) and US limited liability partnerships (LLPs) would be classified as corporations for Canadian tax purposes. We previously discussed this announcement in our May 27th blog, entitled “CRA confirms US LLLPs and LLPs are indeed corporations”.

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