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Snowbirds under scrutiny

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Guest | 13 Mar 2014, 05:42 AM Agree 0

Snowbirds who flout the six-month residency rule in the U.S. could face huge tax consequences as the authorities prepare to clamp down on short-term residents.
The changes are part of the Entry-Exit Initiative and the Perimeter Security and Competitiveness Action Plan, a larger cooperative effort between the U.S. and Canada that was announced in 2011.
From June 30, the authorities will share the information of travellers when they both enter and depart each country. Prior to this, Canadians had to self-report their time out of the country and residence status.
With less purchasing power thanks to the falling Loonie and some U.S. markets rebounding fully, many critics believe snowbirds and investors may postpone their American investment dream this year.
However, Ryan Kohl from Express Capital Mortgage in Arizona tells CREW that Canadian demand is still as strong. “Our volume increased last year and we financed over 450 properties for Canadian investors just in Arizona alone before branching out in other states. Already this year as of March 1, we have facilitated the financing for 125 properties and currently have another 475 properties in process due to close in the next two months.”
Snowbirds that reside in the U.S. for longer than 180 days in a rolling 12-month period could be deemed a resident and subject to tax on worldwide income, while their property could also be liable for estate tax.
The residential rules could also impact Canadians who are away from their primary residence for long periods of time. For example, Ontario residents lose their status if they are away for more than seven months in a year.
Those who overstay could also fall within the “unlawful presence” rules while offenders could be banned from entering the U.S. for a minimum of three years and a maximum of 10 years.
  • Mack | 13 Mar 2014, 06:26 PM Agree 0
    I hope the snow birds get taxed to hell from the americans it will teach em a lesson for taking there hard earned dollars out of canada and spending it.
  • Mack | 13 Mar 2014, 06:31 PM Agree 0
    TRax the hell out of the folks that spend there hard earned canadian dollars out of country. Keep it where its earned is my motto.
  • Pat | 17 Mar 2014, 09:53 AM Agree 0
    Wow. Old and Cold, retirement sounds like fun. Slip on Ice and break a hip or get Taxed to hell, great choice' s Mack.
  • Scott Simmons | 19 Mar 2014, 11:09 AM Agree 0
    I see escalating health care cost as another main reason so many are not going to be heading south. The cut off seems to be 75 years old. Once over that point it becomes really cost prohibitive. The west coast is probably a better bet for many. With BC pro senior property tax system in place it's only a matter of time before we are overrun with boomers. What is the BC advantage, how about the home owners grant, senior grant and the big one is property tax deferment. The astute seniors are snapping up the 2 acre plus hobby farm properties and claiming farm status thus getting them cheep gas (for there farm truck) discount on electricity and no land tax at all except for the foot print of their home. Cheers Scott on Salt Spring Island BC
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