CAA Saskatchewan Winter 2018 | Page 17

How do I calculate the amount of days I can stay? The two most important formulas are the immigration and tax calculations. The immigration formula is simpler: U.S. Customs and Border Protection allows Canadian residents to enter the country as B-1/B-2 visitors. The B-1/B-2 visas grant visitors up to six months in the States, with a strict exit date. What about the tax-related formula? This one is more complicated. The basic premise is that if you spend too much time in the U.S., then you risk being deemed a U.S. resident and could be taxed as such. To figure it out, use the Substantial Presence Test (SPT). Add up the days you spend in the States in the current calendar year, plus one-third of the days you spent there in the previous  calendar year, plus one-sixth of the days spent in the calendar year two years prior to the current year. (Keep in mind that a day is considered a calendar day—not a 24-hour period. So even if you spend only a short period of time in the U.S. on a particular day, you need to count it in your calculation.) If your total is 183 days or more, you may be deemed a U.S. resident for tax purposes. Travel Intel Migratory Patterns What snowbirds need to know about flying south for winter without overstaying their welcome It’s a right of passage for many: Retiring to winter south of the border. But the sand and sun may come at a price. If you stay in the States beyond the established limits, you could face stiff consequences. We asked David A. Altro, a Canada and U.S. licensed attorney and managing partner of ALTRO LLP, to answer some questions about snowbirding. With offices in both countries, Altro and his colleagues specialize in cross-border taxation, real estate and immigration. Why should snowbirds care about days they spend outside of Canada? It’s extremely important for them to accurately count how Snowbirds who miscount their days or ignore this obligation altogether risk trig- gering harsh tax and immigration consequences many days they spend south of the border, wintering in the sunshine. Snowbirds who miscount their days or ignore this obligation altogether risk triggering harsh tax and immigration consequences. Are there any exemptions? What happens if I go beyond the allowed limits? You could run afoul of American immigration policy if you over- stay. You could also be dinged on taxes: If you spend too much time there, you risk being deemed a U.S. resident for tax purposes. On the Canadian side, you’ll want to watch how much time you can spend outside of Saskatchewan before you lose access to free pro- vincial health care. If your SPT total is more than 120 days but less than 182 days, you should file for a Closer Connection Exemption (IRS Form 8840). The exemption shows that you have a closer connection to a country other than the U.S. and thus shouldn’t have to pay taxes like a resident. You’ll be eligible if you spend 182 days or fewer south of the border in any individual calendar year. But you’ll also have to meet certain criteria to prove that you have a closer connection to Canada than the U.S. CAA SASKATCHEWAN Winter 2018 17