Vacationing in USA (Info and Links)

Canadians Vacationing in USA (Info and Links last updated in 2019)

I have been researching online what the rules are regarding Canadians traveling to the USA. I want to make sure we have all the information required to make educated and smart decisions. Here is resume of what I found, with links to pages, articles and websites.

Playing it safe.

To meet the requirements to keep your Canadian provincial health coverage, not exceed the maximum consecutive days allowed in the USA and to remain exempt of becoming considered a USA resident in the eyes of the IRS (USA’s equivalent to CRA), you should spend no more than 120 days per calendar year in the USA.

General rules:

Heath Care: To ensure you don't lose your provincial medical coverage, OHIP for Ontario or Medicare for New Brunswick, you must be in the province for at least 153 days during a 12 month period. That means you can be absent from the either province for a total of 212 days, to maintain your eligibility.

Additional information can be found at the following pages.

Length of stay: Canadians with a valid passport, can “generally” stay in the USA up to 6 months (180 days) from the time of entry.

However, if you spend the maximum number of days annually, you may have to pay the Internal Revenue Service (IRS) income taxes on your worldwide income! The IRS has a formula to calculate if you meet the “Substantial Presence Test”.

The Substantial Presence Test (IRS) – The magic number of days you want to stay under is 183.

Example:

Current year (ie 2018): total days count
Previous year (ie 2017): total days divided by 3 counts
Two years previous (ie 2016): total days divided by 6 counts

Example 1: 120 + (120/3) + (120/6) = 180

You are OK

Example 2: 150 + (126/3) + (24/6) = 196

You would not be OK – will need to fill form 8840

If you end up with a number over 183 for the 3 years, you will have an additional document to complete, before June 15, so that you do not have to pay income taxes in the USA.

You are present in the USA for less than 183 days during current the year.
You paid your income taxes in Canada the current year.
You have a closer connection to Canada, have a home, …

Form 8840 - Conditions for a Closer Connection to a Foreign Country (IRS)

Examples of what they will verify (Form 8840):

The country of residence you designate on forms and documents;
The location of:

Your permanent home,
Your family,
Your personal belongings, such as cars, furniture, clothing, and jewelry,
Your current social, political, cultural, or religious affiliations,
Your business activities (other than those that constitute your tax home);
The jurisdiction in which you hold a driver's license;
The jurisdiction in which you vote; and
Charitable organizations to which you contribute.

Note: It does not matter whether your permanent home is a house, an apartment, or a furnished room. It also does not matter whether you rent or own it. It is important, however, that your home be available at all times, continuously, and not solely for short stays.

Extended Stay:

If you plan on being in the USA longer then the initial 6 months. It is recommended that you apply to extend your stay at least 45 days before your authorized stay expires.