U.S. citizens
Any American citizen, regardless of residency status, must file an annual U.S. tax return (Form 1040) in which it will include its worldwide income.
In Canada, it’s the residency requirements that determine if you must file an income tax return. So if you are a U.S. citizen resident in Canada, you must file two income tax returns each year. This does not mean that you will be doubly taxed because some mechanisms can adjust to this situation. The foreign tax credit is one example.
Also, if you live outside the United States, your U.S. return must be filed on or before June 15 (that is two months more than if you lived in the U.S.). The interests on the unpaid balance are applicable from April 15th.
Withholding taxes on lottery winnings
Unlike Canada, the United States taxes the gains from lotteries (gambling winnings). For example, if you win $ 5,000 in the casino during your stay in Las Vegas, it is likely that will be withheld 30% of this amount for taxes and we invite you to complete your American income tax return, even if you are neither a citizen nor a U.S. resident. As a Canadian non-resident of the United States, you will need to complete Form 1040NR. The payer (for example, casino) will give you a tax sheet (1042-S, Foreign Person’s U.S. Source Income Subject to Withholding) for this purpose. In addition, you can deduct gambling losses AGAINST your gambling winnings if you have kept your proof of purchase (invoices, tickets from the machine, etc).
U.S. tax withheld on payments made to Canadian
U.S. payer is usually required to withhold up to 30% of any amount other than wages he pays a non-resident by way of withholding tax.
If the payer withheld amount for taxes when you are a citizen or U.S. resident, you can ask him to correct this error by using the Form W-9. This is a misunderstanding that can occur if you use a foreign address.
