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US Canada Cross-Border Tax Seminar: What to know when investing in US real estate

July 17, 2012

The US real estate market has been at all-time lows for some time now. Many Canadians have been looking at this as a time to begin investing for income and/or planning for retirement.

What to Know When Investing in US Real Estate Seminar: August 31st, 2012

Date & Time:
August 31st at 9am-12.

Northview Golf & Country Clu
6857 – 168th Street
Surrey, BC V3S 3T6

Continental breakfast included

Download Signup Form for Seminar Here

This article will go over areas that as a Canadian you should be aware of.

US & Canadian Tax and Legal Professionals

Even though the US is our neighbor it is still a foreign country and as such has its own tax regime and legal procedures. This is a very important concept to understand. You will be required to be compliant with requirements that may be substantially different from those familiar to you, both for taxation purposes and legal filings.

For taxes, please be sure to use a Chartered Account (CA) firm that has experience in both US and Canadian taxes. Just having knowledge on one side isn’t enough anymore. There are plenty of tax rule differences and ways to minimize tax for US purposes but some decisions could have quite the opposite effects on the Canadian tax return; and vice versa.

To go over some of the reporting issues for individual taxes, we will be hosting a presentation on August 31st in Surrey British Columbia. Please see our home page for up-to-date info.

The rules for Canada and the US are similar but there are many differences that you may not be aware of. For legal advice we strongly recommend getting in touch with a lawyer who understands both Canadian and US law to ensure that you are covered on both sides of the border.

US & Canadian Corporate Structures and Liability Protection

Lawsuits happen every day and in the US this is an area where you will want to be protected. There are many different kinds of insurances that include flood, earthquake, fire, tornado, hurricane, etc. One item that should always be included is third party liability insurance. This insurance offers protection in the event that someone was to sue for damages for various reasons including someone getting hurt on your property.

Other ways to protect yourself from lawsuits is to setup a structure that may include setting up a partnership(s), corporation(s), and/or trust(s) to provide additional protection. Structures also help when you are looking at high value properties and/or multiple properties in the US.

We will be hosting another presentation on the various structures that one can take advantage of for both legal protection and tax planning. We will be posting this date and time in the near future on our website.

US and Canadian Estate Tax Planning

There is also estate tax planning issues in the US that should be addressed. Not only for the estate but also on the taxes to be paid once the investments and money are paid out to the beneficiaries.

One concern is the US estate tax that can be as high as 50%. Currently the Federal threshold is set at $5 million threshold before estate tax becomes a factor. However, this threshold is set to go back to $1 million in 2013. The amount is based on the worldwide estate value and depending upon the portion of US sourced assets could cause substantial estate tax. Please note that each state also has its own estate tax and reporting requirements which can often be missed.

The assets with or without a proper will and estate planning may have to go through US probate. This process requires lawyers to file the proper paper work and could take 4 months or longer to get access to the assets. Often state probate procedures will not recognize Canadian probate, so your executor may face twice the anticipated administrative burden.

Estate planning is to be done on a one-on-one basis as each person is different and may require different structures or legal documents in order to best meet their individual needs.


If you have any other tax-related queries, and/or need assistance with tax planning/filing please contact AG Tax. Our tax professionals are highly-experienced with U.S. and Canadian tax laws and can provide you the right guidance to handle your tax situation.

Aylett Grant Tax LLP is a full service accounting firm with a dedicated team of experts, who are highly-qualified and experienced in handling situations related to U.S., Canada and other international tax laws.

We can assist with:

  • Canadian Personal and corporate tax returns
  • Cross Border Taxation and Business Planning
  • Personal and Corporate Taxation
  • Disclosure of Foreign Assets and other information filings
  • Retirement planning
  • Estate Planning, Inheritance tax advice

To obtain a quote or to arrange for a consultation to discuss your tax related queries, please contact us at:

  • 416-238-5920 (Greater Toronto Area, ON)
  • 604-538-8735 (Greater Vancouver Area, BC)
  • 780-702-2732 (Greater Edmonton Area, AB)


Disclaimer: The information in this publication is accurate as of the time of its publication. AG Tax assumes no responsibility for changes to tax legislation subsequent to the publication of this document. The information provided is for general information purposes only and should not be acted upon without seeking professional advice. If you would like to engage our services, please contact our staff and obtain authorization to send our firm confidential information. A client relationship is not created by the transmission of information. A client relationship is only formed with our firm when a scope and engagement letter signed by the firm and the potential client detailing the terms of engagement is present.

ABOUTAylett Grant Tax, LLP
With offices across Canada, we are positioned to manage and process the full scope of your Canadian, US and US Canada cross-border tax filing needs.
12752 28th Ave, Surrey, BC, V4A 2P4
104–4220 98 St NW Edmonton AB, T6E 6A1
With offices across Canada, we are positioned to manage and process the full scope of your Canadian, US and US Canada cross-border tax filing needs.
12752 28th Ave, Surrey, BC, V4A 2P4
104–4220 98 St NW Edmonton AB, T6E 6A1

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