Working in the US as a Canadian: Tax, Visa & Financial Guide
Updated
Working in the US means dealing with two tax systems at once: the US decides whether you are a US tax resident by its own tests, while Canada keeps taxing you as long as you stay a Canadian resident. This guide covers the visas, the US residency tests, cross-border filing and how the US treats RRSPs, TFSAs and RESPs. It is part of the international and cross-border tax guides; whether you remain a Canadian resident is covered in am I a Canadian tax resident.
Canadian return (if still CRA-resident) or departure return
US resident (green card holder)
Permanent resident
US return on worldwide income
Canadian return (if still CRA-resident) or departure return
US citizen (naturalized)
After citizenship
US return on worldwide income (forever)
Canadian return only if CRA-resident
Substantial Presence Test
Year
Days in US
Multiplier
Counted Days
Current year
120 days
× 1
120
Previous year (year −1)
120 days
× 1/3
40
Year −2
120 days
× 1/6
20
Total
180 (< 183 = non-resident)
If total ≥ 183, you are a US tax resident. The closer-connection exception may still help if your ties to Canada are stronger.
While you remain a Canadian resident, Canada taxes your US pay as part of your worldwide income and credits the US tax against it.
Comparing the tax bill
How much of a salary goes to tax differs between a Canadian province and a US state, and US payroll taxes and health insurance change the comparison. Side-by-side figures for the same income are in the Canada vs USA tax comparison.
Cross-Border Financial Planning
RRSP: US Tax Treatment
Scenario
US Tax Treatment
Action Needed
Contributions (while Canadian resident)
Not deductible in the US
No US benefit
Growth (while US resident)
Tax-deferred (automatic under the treaty since 2014)
No annual election or filing needed; disclose on FBAR/FATCA if thresholds are met
Withdrawals (while US resident)
Taxable in US as ordinary income; taxable in Canada (15% withholding)
Foreign tax credit to avoid double tax
Common approach
Keep RRSP, let it grow tax-deferred; withdraw in retirement when in lower tax bracket
Converting to an IRA is possible but very complex; cross-border advice is common
TFSA: US Tax Treatment
Scenario
US Tax Treatment
While US resident
IRS does not recognize TFSA; all earnings taxed annually
PFIC implications
If TFSA holds mutual funds or ETFs, US anti-deferral rules (PFIC) create punitive taxation
Reporting
FBAR (FinCEN 114) + Form 8938 reporting required once balances pass the reporting thresholds
Common approach
Collapse TFSA before becoming a US tax resident
RESP: US Tax Treatment
Scenario
US Tax Treatment
While US resident
IRS does not recognize RESP; earnings taxed annually
Same as TFSA: mutual fund holdings create complexity
Common approach
Cross-border advice; the plan may need to be collapsed or restructured
Social Security & Retirement
US citizens and green card holders who later live in Canada keep filing in the US; FBAR, FATCA and PFIC rules for that group are covered in the dual citizenship tax guide.
Canada-US Social Security Agreement
Feature
Canada (CPP/OAS)
US (Social Security)
Qualifying for benefits
CPP: no minimum, based on actual contributions. OAS: 10 years of Canadian residency after age 18 for a partial pension
Need 40 credits (10 years of work)
Totalization agreement
✅ Combines CPP + SS years to qualify
✅ Combines SS + CPP years to qualify
If you worked in both countries
May receive partial CPP + partial SS
May receive partial SS + partial CPP
Taxation of benefits
CPP/OAS taxed differently in each country
SS benefits taxed at 0–85% in US; taxed in country of residence (treaty)
Example: 15 Years Working in Canada, 10 Years in US
Benefit
Eligibility
Estimated Amount
CPP (15 years of credits)
✅ Qualifies
~$550/month (partial)
OAS (15 years in Canada)
✅ Qualifies (partial if lived in Canada 20+ years by 65)