While the primary concerns for Canadian snowbirds with respect to COVID-19 are health, safety and travel insurance coverage, many Snowbird Advisor members who spend their winters in the U.S. have also expressed concerns about the tax and immigration implications if they are forced to spend more time than anticipated in the U.S. due to travel restrictions, quarantines or medical treatment if they contract COVID-19.
Snowbirds are right to be concerned about these matters, given the potentially severe tax and immigration consequences for Canadians overstaying their welcome in the United States.
While the type of relief the U.S. government may – or may not – offer to Canadians who violate the rules on how long they spend in the U.S. due to COVID-19 are not entirely clear at the moment, we will be sure to keep Snowbird Advisor members informed on this topic in the coming months as the situation evolves.
In the meantime, here’s a brief overview of the tax and immigration issues you should be aware of in the meantime.
There are clear rules for how long Canadians can spend in the U.S. from a tax perspective. If you violate these rules by staying too long, you will be considered a U.S. resident for tax purposes and could be subject to income tax in the U.S. as well as Canada.
However, according to cross border tax lawyer Veronika Chang, there may be some relief from these tax rules if you need to spend too much time in the U.S. for medical reasons.
From an immigration perspective, Canadians are limited in how much time they can spend in the United States in any given period. Generally speaking, Canadians can spend up to 6 months at a time in the U.S. without a visa (it’s actually much more complex than this, but we won’t go into the details here).
If you spend too much time in the U.S. you can be barred from entering the U.S. in the future for varying periods of time.
However, U.S. Customs and Border Protection (CBP) agents have some discretion and flexibility with respect to these limits. Having said that, it is unclear at this time how much discretion, if any, CBP agents will be authorized or willing to exercise when it comes to Canadians who spend too much time in the U.S. due to COVID-19.