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Canadian snowbirds and U.S. property investors: What you need to know

Updated: July 30, 2024

Many Canadians who escaped the severe winter by heading to the southern United States will return in Canada for the summer months. With no precise government statistics, determining the actual number of these snowbirds is hard to ascertain; however, a 2023 snowbirdadvisor.ca report estimates that of the more than one million surveyed Canadian snowbirds, over 85% travel to the U.S., and of those, approximately one-half own their own U.S. real estate. The most popular U.S. winter destinations for Canadians are Florida, Arizona, California, and Texas.

While this lifestyle is attractive, it also involves dealing with the income tax systems of two countries and U.S. estate tax risks. Proper attention to these income and estate tax concerns can provide peace of mind that an unexpected tax bill will not be incurred in the future.

Of course, not just Canadian snowbirds may have U.S. income or estate tax risks. For example, any Canadian who spends an extended time in the U.S. for work or school can have a U.S. income tax filing requirement, and anyone who owns investments in U.S. marketable securities can have a U.S. estate tax risk.

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In the above Insights, we explore these tax issues in-depth, with considerations for snowbirds who spend more than four months a year in the U.S., tax issues relating to renting your U.S. property to short-term or long-term tenants, and the U.S. estate tax exposure that comes from owning U.S. real estate and other U.S. assets. We also cover similar risks for other Canadians who spend an extended time in the U.S. or own other U.S. property.

If you have questions regarding how the U.S. personal income tax rules might affect you, contact our U.S. Tax Practice Leaders in Canada.

Jason Ubeika
Partner, Expatriate Tax
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Joanne Sun
Partner, Expatriate Tax
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