Cross Border Tax Question (Dual Citizen residing in Ontario) - US Remote Contract Work Opportunity

[habiti]

Dual citizen (US & Canadian) residing in Toronto with an Ontario Corporation (Engineering Consulting) since 2013. I have a new US client in Seattle which I want to enter a 8-month contract with (doing remote work from Ontario).

For the US tax purposes for the corporation:

1) Do I need to obtain an EIN number & fill out the 1120-F +8833 or these are not required since my business is in Canada?

2) Do I need to fill out the W-8BEN-E form?

3) Company plans to have me fill out a W-9 (and maybe issue 1099). Can I skip filling out the W9 as my corporation is in Canada and just submit W8BEN-E (which is filed to get an exemption of IRS withholding taxes when receiving payments)?

The plan is to bill the US client monthly through my existing Canadian corporation & continue billing my Canadian clients as well. I also have a US address (parents) if needed.

 

[jjp297]

@habiti

an Ontario Corporation (Engineering Consulting) since 2013.

Hopefully you have been correctly filing or your Controlled Foreign Corporation.

1) No recuasse you are not working int he US.

2) Yes if you are doing Corp to Corp.

3) Are you doing it Corp to Corp or freelance (self-employed?

 

[habiti]

@jjp297 Perfect. Thanks.

1. Will not obtain the EIN number & fill out the 1120-F +8833
2. Will fill out W-8BEN-E since I will be Corp to Corp.
3. The plan is to do Corp to Corp. If it is Corp to Corp, can I skip the W-9 & just submit the W-8BEN-E?
   1. Just to clarify by self-employed do you mean Sole Prop? In a way it will be freelance (may pick up other US clients to bill but all under the Ontario Corp)

 

[jjp297]

@habiti 1) For the 1120F, speak to your cross border accountant. (including CFC: https://www.irs.gov/instructions/i5471)

3) Yes because you are not doing work for them personally or in the US.

3a) Yes, sole prop and self-employment are the same thing in Canada. It's personal income

 

[habiti]

@jjp297

No recuasse you are not working int he US.

Thanks a lot!

3) I will skip the W-9 in that case (since corp - to - corp) & just submit the W8BENE.

I will the US client know I do not need to submit the W-9 & they do not need to issue a 1099 year end since corp to corp

 

[jjp297]

@habiti You have to tell them the the details of the deal you are making (ie: corp to corp vs freelance/self-emplyed).