What actually makes someone a covered expatriate?
Three tests are applied at the moment of expatriation. The first looks at average annual income tax for the years before expatriation. The second looks at net worth on the date itself. The third asks whether the person can certify compliance with their obligations for the preceding years. Meeting any of them makes a person covered. The third is the one to check first, because failing to certify makes a person covered no matter how modest their income and assets are. It is also the only one still capable of being fixed, since it depends on filings rather than on the size of an estate.
Do I need to file back returns before giving up citizenship?
Check this before anything else. Certification of compliance for the preceding years is one of the three tests, and a person who cannot certify is covered regardless of the other two. That is a compliance question, not a wealth question, so it catches people who assumed their circumstances were too ordinary to matter. It also takes time to answer: the years in question are historic, records may be incomplete and any remediation has to be finished before the expatriation date rather than after it. Establish which years are in scope and what condition they are in before an appointment is made.
I am below the net worth threshold, so am I still covered?
Possibly. Net worth on the expatriation date is only one of the three tests, and the other two operate independently. A person comfortably below the net worth mark can still be covered through the income tax test or, more often, through failing to certify compliance for the preceding years. This is the misconception we correct most frequently: people measure their balance sheet, conclude they are safe, and never look at their filing history. Work through all three tests, in the order that reflects how long each takes to resolve, rather than stopping at the one that is easiest to assess.
Which years does the certification test look at?
It looks backwards, at the years preceding expatriation, which is why it cannot be dealt with on the day. The certification is a statement about obligations that arose while the person was still a citizen or long-term resident, so the work involves reconstructing what was required then and establishing whether it was done. That often means chasing records held by former employers, banks and advisers in more than one country. The practical consequence is scheduling: the review of the historic years has to start well before the intended date, because the remediation, if any is needed, has to be complete by then.
Does renouncing fix the problem if my past filings are incomplete?
No, and it can make the position worse. Renunciation ends the status going forward but does not retire obligations that arose beforehand, and it is precisely those earlier obligations the certification test asks about. Someone who renounces with incomplete filings behind them can find they are covered for that reason alone, having assumed the act of leaving closed the matter. The sequence has to run the other way: establish what the historic position is, put it right if it can be put right, and set the date once the certification can honestly be made.
When should I start looking at this before I expatriate?
Earlier than most people do. Two of the three tests are measured at the expatriation date, so the date itself is a variable you can plan around, and the third depends on historic filings that may take considerable time to establish and correct. Once the date passes, the position is fixed and the options that existed beforehand are gone. A sensible order is to establish the compliance history first, because it takes the longest and can determine the outcome by itself, then measure the position on the intended date, then decide whether the date should move. We agree a fixed fee in writing before that work starts.
When does my Canadian tax residency actually end?
On the day your residential ties are severed, which is a question of fact rather than of the date on the boarding pass. The CRA weighs the significant ties first — a dwelling available to you, a spouse or common-law partner, and dependants in Canada — then secondary ties such as licences, memberships, accounts and provincial coverage. Keeping a home available while your family stays is the pattern that most often means residency never ended at all. See departure tax on leaving Canada.
How do I file US taxes from abroad?
The same forms as anyone else, electronically where your circumstances allow it and on paper where a form or an election requires ink. Three differences matter. An automatic extension applies where your main home is outside the United States. The account report goes to FinCEN separately from the return, on its own schedule. And interest on any balance runs from the ordinary due date regardless of extensions, so an extension buys filing time, not payment time. See a US return from abroad.
