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Lev
Lev, Tax Advisor
Category: Canada Tax
Satisfied Customers: 28084
Experience:  Taxes, Immigration, Labor Relations
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I am a Canadian living in Toronto. I am thinking of buying

Customer Question

I am a Canad***** *****ving in Toronto. I am thinking of buying multiple homes in the upstate New York area. I would then rent those homes and use the income to cover renting a home in the Toronto area. Do I pay tax on the income both in the U.S. and in Canada?
Submitted: 1 year ago.
Category: Canada Tax
Expert:  Lev replied 1 year ago.

You will have separate income tax liability in each country.
In the US - as a nonresident alien - you will be taxed ONLY on income from US sources - that is regardless your Canadian tax liability.
In Canada - as a resident - you are taxed on all your income - including income from the US.
Then - you will need to determine if any specific income is taxed in both countries - if yes - on your Canadian tax return - you will claim a credit for foreign taxes paid in the US - thus effectively will avoid double taxation of the same income.
Regarding your US tax liability - you will report income from US rentals and will deduct expenses related to US rentals only.
Let me know if you need help with reporting.

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