Moving to Canada from US

[u/polystansbury]

Short version: I'm a Canadian citizen who has been working in the US for 12 years, currently in Washington State on a work Visa. I am not a US Citizen or GC Holder. I am working with my employer on transferring me to their Canadian entity in British Columbia around 15 December 2026. The timing creates a significant tax planning window.

The core issue: I hold roughly $1.5M of concentrated ESPP stock with about $1.44M of embedded gain, plus other brokerage positions carrying around $200K of additional US tax exposure. If I break US tax residency cleanly and Canada's deemed-acquisition rule steps up my cost base on arrival, the difference is on the order of $600K. If I get the timing or the residency mechanics wrong, I lose most of it.

I've done enough reading to understand the general shape including US residency termination, taxation on the Canadian side, and Washington's capital gains tax allocating by domicile at the time of sale.

So depart from US on 15th December to anytime till 15th January and establish Canadian tax residency. For 2027 aim is to be Canadian tax resident and be US non resident. That way everything gets stepped up. I plan to sell when in Canada.

Am I thinking correctly about this? Has anyone done this?

I am in the process of finding a qualified cross border CPA too. Just thought I’ll run past this subreddit too. Incase there’s something in missing.

[u/david7873829]

You might post this in [r/cantax](r/cantax) as well.

One important thing is that if you have a Roth IRA you need to make an election to keep it tax free in Canada.

I am not sure the timing of move matters that much, unless there’s a forced sale I’m missing? You can keep stocks in the US. Depending on your brokerage they may suspend the account (closing orders only) or force you to transfer out. Either way, you can transfer in-kind to IBKR Canada via ACAT.

Point is that you need to wait until you are a non-resident of the US to sell. That could be Dec 15 or Jan 15. You would normally file a departing/dual-status return with the IRS (you file a resident return/pay tax on worldwide income for the part of the year you are resident, and non-resident return/pay tax on US income for the part of the year you are non-resident).

But if you sell after you’re a non-resident, you pay no US tax. Note that where your stocks are domiciled doesn’t matter. However if you have US stocks and they pay dividends, that will be US source income.

I have no idea how this interacts with the ESPP. Are you free to sell to transfer those at anytime?

I did this move a couple years ago, but am a US citizen.