Your average US-based CPA or Canada-based Chartered Accountant is not well-versed in the nuances of cross-border taxation. They don't understand the lingo, the tax treaty, or prepare their clients for the many surprises of how the IRS operates. This leads to MAJOR tax blunders, which we usually see from clients who come to us looking for cross-border tax expertise.

Here are the three big cross-border tax blunders we've seen:

#1: Deemed Dispositions: A Canadian Taxing Point Often Missed

Why it Matters: Correctly handling deemed dispositions is crucial not only for accurate Canadian tax filing but also for your US tax return. The fair market value of your assets on your departure date from Canada becomes your cost basis for US tax purposes, directly impacting your future US capital gains taxes.
#2: Tax Treaty Benefits: Unclaimed Opportunities on the US Side

Why it Matters: Missing out on tax treaty benefits can lead to overpaying taxes in the US, costing you thousands of dollars. Ensuring your tax preparer understands and applies the treaty provisions is crucial to optimize your cross-border tax situation.

#3: Foreign Asset Reporting: A Major Compliance Pitfall in the US

Why it Matters: Failure to properly report foreign assets can lead to hefty penalties, including fines that can reach 50% of the account value. Non-compliance can also trigger IRS audits and investigations, causing significant stress and financial hardship.

Get help planning for a cross-border move, operations, and taxes:

🇺🇸 Houston Office - (713) 451 - 9700
🇨🇦 Toronto Office - (416) 800 - 2709
📧 info@akifcpa.com

About Akif CPA
Our goal is to exceed our client’s expectations by providing exceptional quality services. We thrive when we help your business grow.

We are a team of highly skilled tax professionals with years of experience and expertise in the field of tax, accounting, business advisory, payroll, business consulting, compilation and review services, sales tax audit and financial planning. We provide comprehensive solutions to businesses and individuals.

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Comment any questions or email us at info@akifcpa.com We will tackle those in future videos.

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