Ordinarily yes, but at least for this specific case, perhaps not. The US/Canada tax treaty has a special clause that seems to cover it, "Gains" Article XIII, paragraph 7:Pretty sure that the US will ignore any departure tax paid on capital gains. Best thing to do is to actually sell. Plus you will probably want to change which funds/etfs/etc. that you own. So, sell before you depart and then rebuy once you become a US resident.Questions around Departure tax for IRS side:
I record the value for the CRA to pay Canadian 2024 departure tax.
What happens in the US when I actually sell?
Do I show my Canadian 2024 tax return and those years are excluded from US tax?
IRS form 8833 treaty claim in year(s) of sale, then? (And unless specifically requested by the IRS, which is unlikely, no requirement to back this up with any copies of Canadian returns as far as I know.)7. Where at any time an individual is treated for the purposes of taxation by a Contracting State as having alienated a property and is taxed in that State by reason thereof and the domestic law of the other Contracting State at such time defers (but does not forgive) taxation, that individual may elect in his annual return of income for the year of such alienation to be liable to tax in the other Contracting State in that year as if he had, immediately before that time, sold and repurchased such property for an amount equal to its fair market value at that time.
Statistics: Posted by TedSwippet — Tue Apr 23, 2024 6:46 am — Replies 7 — Views 433