TN Visa Tax Guide: How an EA Helps Canadians Working in the US

2026-07-09

Last reviewed: July 9, 2026. This article reflects current IRS rules and EA exam requirements as of this date.

The TN visa is the fastest path for Canadian professionals to work in the United States. No H-1B lottery. No annual cap. A job offer, an appointment at the border, and you're a US worker. Tens of thousands of Canadians do this every year.

The tax obligations catch up fast.

The TN Visa Tax Problem

When a Canadian starts working in the US on a TN visa, four things happen simultaneously:

1. US tax residency begins. If you spend 183 days or more in the US during the calendar year, you're a US tax resident under the substantial presence test. Most TN workers hit this threshold easily — you're living there, working there, spending your days there. The US taxes your worldwide income.

2. Canadian tax residency might not end. If your spouse and kids stayed in Toronto, if you kept your Ontario health card, if you still have a Canadian driver's license and bank accounts — Canada may still consider you a tax resident. The US-Canada tax treaty has a residency tie-breaker under Article IV, but claiming it requires facts analysis, not just checking a box.

3. You might be dual-status. The first year you move is the most complicated because you need to file as a dual-status alien: a nonresident for the part of the year before you moved and a resident for the part after. The rules for dual-status filing are different from regular resident filing. You can't use the standard deduction. You can't file jointly. Certain credits and deductions are unavailable.

4. The departure tax might apply. If Canada determines you've ceased to be a tax resident, they may impose a deemed disposition on your assets — treating everything you own as sold at fair market value on the day you left. The tax is due on the gain even though you didn't actually sell anything. An EA can help with the US-side implications and coordinate with a Canadian accountant on the strategy.

The Filing Strategy

Step 1: Determine residency. Are you a US resident, Canadian resident, or both? Apply the treaty tie-breaker: where is your permanent home? Where are your personal and economic relations (center of vital interests)? Where do you habitually abide? Where are you a citizen? If the US wins under the tie-breaker, you file as a US resident and a Canadian non-resident. If Canada wins, you're a US nonresident alien and file Form 1040-NR.

Step 2: Handle the dual-status year. File Form 1040 with a dual-status statement attached. Report US-source income for the nonresident period on the statement. Report worldwide income for the resident period on the 1040. Claim treaty positions if applicable.

Step 3: File the treaty elections. If you have Canadian RRSPs, file the Article XVIII(7) election with Form 8833 to defer US tax on the accounts. If you're claiming the treaty tie-breaker for residency, file Form 8833 for that too. If you have cross-border dependents, file the appropriate treaty-based returns.

Step 4: Coordinate with the Canadian side. Your Canadian return needs to match. The CRA will ask for your US tax information. The IRS will ask for your Canadian tax information. Both sides need to be consistent on residency, income, and treaty positions. A mismatch triggers an audit on one side or both.

Why an EA Rather Than a General CPA

A domestic US CPA who's never handled a cross-border return doesn't know about the treaty tie-breaker, the dual-status rules, the RRSP election, or the departure tax. They'll file a standard resident return and hope for the best. A standard return for a dual-status filer is wrong. It can cost thousands in incorrectly paid tax or penalties.

An EA who specializes in cross-border work understands the full picture: the treaty, the dual-status filing, the departure tax implications, and the coordination with Canadian preparers. The EA Part 1 exam covers filing status, dependents, the Foreign Earned Income Exclusion, and foreign tax credits. The EA Part 3 covers representation — what happens when the IRS challenges a treaty position.

If You're on a TN Visa Right Now

Your filing is more complex than the average American's. You need a preparer who understands both systems. Where to start:

Search the IRS Directory for an EA with cross-border experience
Ask Canadian accounting firms if they have a US-credentialed preparer on staff or partner with one
Look for practitioners who specifically handle TN visa tax work — they'll mention it on their website

Start studying for the EA →