Moving to the US from Canada as a graduate student
I am a Canadian citizen and moved to the US with F1 status when I started my degree. I couldn’t find that many accounts of how to do this online at the time of writing, so I’ve written up some observations I made (primarily about financial considerations).
Financial and Tax considerations
SSN I had a SSN from working in the US previously but it seems like a lot of services require this, including your salary payment, so try to get it set up asap. I remember that it took about 1 week to get my SSN card (it’s actually a piece of paper which is kind of strange). As I recall it is only possible to do this when you are inside the US. When you get an SSN, however, it is for life.
Tax residency and status For the first 5 years on F1 status, students are considered nonresident aliens. This means I pay US taxes on US-source income and Canadian taxes on worldwide income. However the US tax is taken first, and there is a treaty to prevent double taxation for Canada. What I didn’t realize is that in fact if you have tuition credits leftover for example, those get applied before any federal or provincial tax credits which I suppose is not ideal.
As well, it seems mandatory to be a tax resident of some country which means I cannot be nonresident of both countries. In my case as F1, I am considered a nonresident of the US and therefore a resident of Canada. I maintain residential ties in Canada and I am taxed as if I never left both at provincial and federal level as a factual resident. I believe that I’ll need to declare residency in the US when my F1 status expires. I may update this when I find out more about it.
My stipend is currently taxed at the federal level in the US. As well, the CRA agent I talked to cited Paragraph 3.73 to state that the income used for research grants is not taxed but this does not include living and personal expenses. Therefore in my case, my stipend is considered taxable by Canada as well. Here’s also one relevant forum thread on the topic. It seems like some posts do suggest that PhD stipends recieved in the US should not be taxable since Canadian PhD students are not taxed. However, quoting from section 3.73 and 3.74 (Research expenses) I felt the stipend may not qualify as allowable research expenses:
3.73 Research grants only need to be included in income to the extent that the grants exceed allowable expenses incurred by the taxpayer in the year for the purpose of carrying on the work. The research expenses allowable under paragraph 56(1)(o) may not exceed the total research grants taxable in the year under that paragraph. In other words, research expenses cannot be applied to reduce other types of income such as scholarships, employment income or business income. By virtue of section 67, research expenses are also not deductible to the extent that they exceed an amount that is reasonable in the circumstances.
3.74 In this context, allowable research expenses do not include:
- personal and living expenses of the taxpayer (other than travelling expenses incurred by the taxpayer while away from home in the course of carrying on the work, including amounts spent for meals and lodging - see section 3.75);
- expenses for which the taxpayer has been reimbursed (except to the extent that these reimbursements are included in income as part of a grant received); and
- expenses that are otherwise deductible in computing the taxpayer’s income. —
In addition, this PF for PhDs post seems to suggest if a W2 is recieved for the work, it does need to be taxed – though the post applies to American students.
When I arrived here I had set up an account with BMO Harris bank, which is related to its Canadian arm BMO. However I’m not sure I’d recommend this since moving money between Canada and the US in both directions required opening multiple accounts and furthermore very few BMO reps could answer my questions. Currently I write cheques to myself in order to move money from the US to Canada. Instead it may be better to start off with some cross border account e.g. the one offered by TD Bank.
To start out I needed to convert some CAD to USD to cover moving expenses. At the time I did this through the bank, but this takes a significant cut of the money transferred when you conside the difference in their exchange rate from the mid market rate. If I could repeat that I might do it through a service like Transferwise which does not require an international wire transfer. You must have a bank account on both sides in order to use Transferwise, however, because you need a ‘TO’ as well as a ‘FROM’ bank account. As well, transfers from canadian accounts are (as of the last time I checked) only possible in CAD and transfers to US accounts only possible in USD. I think this is because transferwise matches transactions that occur in opposite directions. It also means you cannot transfer USD from a US-based to a Canada-based bank account. However, for the intrepid with a brokerage account, there is also Norbert’s Gambit which may provide an even better rate.
I found my apartment and roommates through Craigslist with no issues and currently pay something on the middle-low side for Pittsburgh (for your state, you can check out the statistics online (e.g. on Apartmentlist). It seems timing is strongly associated with when you can find a good place. During the off season (for Pittsburgh, this seems to be between November and February) the listings appear to be of comparatively better price and quality.
It seems like grocery delivery services are used often here and since I don’t have a car, the free delivery is usually a good bargain. For perishable groceries in my area, I think the pricing here is generally Aldi > Target > Giant Eagle > Whole Foods.
Unfortunately despite continuing to pay taxes for it, it seems OHIP (Ontario’s health insurance) does not really cover you when you are overseas except for emergencies. I believe this is partly due to cost differences between US and Canadian procedures as suggested by this CBC article. Thus I currently use my school’s health insurance.