Each year, many retired individuals escape from the long and cold Canadian winters by flocking to popular warm climate destinations in the U.S such as Florida and Arizona. While some Canadian snowbirds choose to rent their vacation or retirement home in the south, others choose to purchase their own condo or other U.S. real estate property. Though owning your own U.S. vacation or retirement property may have its advantages, you may be surprised when you factor in the numerous tax requirements and other considerations that can substantially increase the complexity of owning a home in the U.S. Those additional issues may include U.S. tax on rental income, potential U.S. withholding taxes should you sell your real estate property and U.S. Estate Taxes upon death.

Additionally, it is important to be aware of your potential dual tax filing requirement that may require you to file both a Canadian and a U.S. tax return (even for taxation years for which there is no tax payable in the U.S.). While foreign tax credits are available to reduce or eliminate potential double taxation, it is not always possible to avoid any incremental taxation. 

Owning and Renting Property in the U.S. 

U.S. Residency Status for Canadian Snowbirds