Canadians who do not have a Social Security number need to obtain a US Individual Taxpayer Identification Number (ITIN) to file a 1040NR return. To obtain an ITIN, you must complete Form W-7, available on the IRS website. In addition to Form W-7, a Certified Passport is required. Passports are certified for Canadians at Passport Canada offices for a minimal fee. If the ITIN is for the filing of a 1040NR return, you can check box B indicating that the ITIN is for filing a US tax return. The W-7 Form, along with the Certified Passport, is attached to the 1040NR return for processing.
The Foreign Investment in Real Property Tax Act (FIRPTA) requires the IRS to withhold a percentage of the gross sales price at Canadians who do not have a Social Security number need to obtain a US Individual Taxpayer Identification Number (ITIN) to file a 1040NR return. To get an ITIN, you must complete Form W-7, which is available on the IRS website. Additionally, a Certified Passport is required for Form W-7. Passports are certified for Canadians at Passport Canada offices for a minimal fee. If the ITIN is for filing a 1040NR return, you can check box B, indicating that the ITIN is for submitting a US tax return. The W-7 form and the Certified Passport are attached to the 1040NR return for processing.
The Foreign Investment in Real Property Tax Act (FIRPTA) requires the IRS to withhold a percentage of the gross sales price at the time of sale if the seller of the real estate is Canadian. Canadians must file a 1040NR return to claim a refund if applicable. For example, if you incurred a loss on the sale of the real estate, you may receive a full refund of the 15% withholding. However, if 15% was not withheld, you need to file a 1040NR to report the U.S. real property sale.
A resident of Canada is subject to Canadian income tax on worldwide income. In the year of sale, Canadian residents must report the gain or loss on sale, as well as any recapture of depreciation, on their Canadian return. The time of sale if the seller of the real estate is Canadian. Canadians must file a 1040NR return to receive a refund if required. For example, if you had a loss on the sale of the real estate, you may receive the entire 15% withholding refunded. However, if 15% was not withheld, you need to file 1040NR to report the U.S. real property sale.
A resident of Canada is subject to Canadian income tax on worldwide income. In the year of sale, Canadian residents are required to report the gain/loss on sale as well as any recapture of depreciation on their Canadian return.
