Your obligation as a Canadian resident to file a U.S. tax return varies according your status as defined by the U.S. Your Canadian status is generally irrelevant in determining your U.S. filing obligations, although it may have an impact on which forms you may elect to file.

If you are a U.S. citizen resident in Canada, you have unique U.S. tax obligations. These are explained under the topic "U.S. Citizens Resident in Canada." If you are not a U.S. citizen, your obligations are described below:

Just visiting

If you are present in the U.S. for less than 31 days in a calendar year, you are considered just a visitor, and you do not need to worry about any U.S. tax obligations. If you fit this category and do not have income from the U.S, you can simply sit back and enjoy your visit!

"Substantially" present

If you are present in the U.S. for 31 days or more, but less than 183 days, in a calendar year, you may meet what is called the "substantial presence" test. To check, add up the following:

• All the days you spent in the U.S. during the year;
• 1/3 of the days you spent there the preceding year; and
• 1/6 of the days you spent there the year before that.

If the total is 183 days or more, you meet the substantial presence test and you are subject to U.S. tax. For example, if you spent 150 days in the U.S. in each of 2001, 2000 and 1999, your calculation would come to 150 + 50 + 25 = 225 and you meet the substantial presence test.

However, if your primary residential ties are with Canada you can still avoid paying U.S. tax by filing the IRS Form 8840, Closer Connection Exception Statement for Aliens. This form must be filed for each year that you meet the substantial presence test. Failure to file when required to do so may result in fines of up to $1,000 for each source of income received, even if no tax would have been payable on your U.S. tax return!

Resident alien