Living in US-Canada border town?

[rylemdr]

My mom was recently telling me about an aunt(distant) who lives in a Canadian(I don't know where) province near a US city. It is a border town, meaning it is a town near another country's border.

She explained to me that this aunt is a Canadian citizen, but since she lives near the US, she just goes over the border and works in the US city.

She further explains that this aunt of mine saves a lot of money by buying groceries in the US and paying lesser taxes from work(than she would in Canada) while getting the much better health and other benefits of the social safety net of Canada.

How can this be possible? Does it really sound as good as it does?

If so, how can I get in on this??

[MossySF]

It's a common occurrence all over the world. In Macau, there's a flood of people crossing the border everyday and Macau residents outnumber the tourists. Macau residents go home everyday in Zhuhai (China) to live, shop, eat and then commute cross-border to Macau to earn 5X the money.

The catch is you have to need residency/citizenship in the country that has more benefits/higher wages. Doesn't help at all if it's the other way around. If you're a U.S. citizen in that border town, crossing into Canada for health benefits won't work.

So how to get that kind of deal: look around the world for border towns with easy crossings. Then find some way to emigrate to the that country. Almost all country have investor visas for you to buy your way in but the 2nd best way would be to find a job there.

[Norbert Schlenker]

saves a lot of money by buying groceries in the US

Probably true, though "a lot" is likely exaggerated.

and paying lesser taxes from work(than she would in Canada)

Definitely false. Residents of Canada are taxed on worldwide income. It makes no difference where she works.

But, hey, one can dream ...

[Sunflower]

...how can I get in on this??

Ummm .... move to a border town?

Really, this isn't an unusual thing in either Canda or Mexico. As for the truth of the benefits ... that's something else.

[Valuethinker]

My mom was recently telling me about an aunt(distant) who lives in a Canadian(I don't know where) province near a US city. It is a border town, meaning it is a town near another country's border.

She explained to me that this aunt is a Canadian citizen, but since she lives near the US, she just goes over the border and works in the US city.

She further explains that this aunt of mine saves a lot of money by buying groceries in the US and paying lesser taxes from work(than she would in Canada) while getting the much better health and other benefits of the social safety net of Canada.

How can this be possible? Does it really sound as good as it does?

If so, how can I get in on this??

You cannot work in America without an America visa or citizenship.

So she has to have that visa: H1B?

The DHS/ INS officers at the border crossing would know her, know her license plate, her car. So you bet the question would be asked and the check made. They use computer systems to record and check license plates automatically, I believe.

Having done that, then yes she could. There are joint arrangements about Social Security etc: I am not quite sure how this works, but she would get SS in place of Canada Pension Plan.

Yes she would qualify for Canadian healthcare (of course) as a resident. And Canadian drug prices. However she would owe tax on her US income, and eventually if she was evading it, this might catch up to her.

I believe there are similar arrangements eg Tijuana/ San Diego? But I am not sure.

Bizarrely, there are similar arrangements between Guantanamo Bay and Cuba: Cubans who work in G'Mo. 2 countries that do not even recognize each other diplomatically, and where one views the other as having stolen the land. At least there were, in the 80s.

Kaffee: He eats breakfast 300 yards away from 4000 Cubans that are trained to kill him. And nobody's going to tell him how to run his unit least of all the Harvard mouth in his white uniform.

-- A Few Good Men

[MossySF]

Certain professions do not need H1Bs under NAFTA. Show up at the border with your employment letter and a NAFTA TN visa is issued on-the-fly. (The same reciprocal terms apply for U.S. citizens who want to work in Canada/Mexico.)

You will pay U.S. taxes since it is a U.S. employer. If such Canadian lived in the U.S., I believe they would not owe Canadian income taxes. However one who commutes to the U.S. would owe Canadian taxes with credit for U.S. taxes paid.

[ladders11]

As far as shopping is concerned, aren't you supposed to "declare" goods brought across the border and pay the GST?

I would not count as "saving" repeated acts of smuggling.

[Valuethinker]

As far as shopping is concerned, aren't you supposed to "declare" goods brought across the border and pay the GST?

I would not count as "saving" repeated acts of smuggling.

Rest assured Canada Customs checks license plates. They are not fools.

[learnfpga]

Canadian citizen needs TN1 (because of the NAFTA treaty) not the H1B. Same for Mexicans.

[integrity]

Canadian citizen needs TN1 (because of the NAFTA treaty) not the H1B. Same for Mexicans.

The TN only covers certain types of jobs. They tend to be technical jobs that require Masters degrees. For anything else you would need a H1B even if you are Canadian or Mexican. In addition, TN is a "status", not a "visa" and consequently they have different rules. Notably, the concept of US residency is treated differently--TN status is a non-resident status whereas H1B is a resident visa. This allows the holder to begin building up years of residency for a future citizenship application. however TN status is cheaper and usually easier to get.

Therefore one may choose to get an H1B instead of a TN even if one had a Masters degree and the job title fit the list.

[FrugalInvestor]

You don't even need to live near an international border to get in on this. Live in Washington state near the border of Oregon. Work in Washington and pay no state income tax. Shop in Oregon and pay no sales tax.

[investomajic]

You cannot work in America without an America visa or citizenship.

So she has to have that visa: H1B?

I think that almost all US work visas (except the TN that others have noted) require US residency. Crossing the border everyday and claiming Canadian residency would probably void most of them. The TN visa might be a grey area, but I am not sure.

The more probable reason she pulls this off is she has dual US / Canadian citizenship.

[friar1610]

I live in Vermont and there is an awful lot of cross-border commerce in both directions. In fact, there is one set of towns right on the border where the international border runs right through the library that serves both towns.

You see lots of Quebec plates at shopping centers in the Burlington, VT area. And there are a lot of Vermont residents, myself included, who like nothing better than a weekend in the big city of Montreal.

Last weekend my wife and I were at a wine tasting at a small vineyard here in VT. There were 3 young women from Quebec there also who wanted to buy a few bottles of wine to take home but couldn't because they were just in VT for the day. They said you had to be out of the country (Canada) for 72 hours before you could bring alcohol back in.

[Valuethinker]

I live in Vermont and there is an awful lot of cross-border commerce in both directions. In fact, there is one set of towns right on the border where the international border runs right through the library that serves both towns.

You see lots of Quebec plates at shopping centers in the Burlington, VT area. And there are a lot of Vermont residents, myself included, who like nothing better than a weekend in the big city of Montreal.

Last weekend my wife and I were at a wine tasting at a small vineyard here in VT. There were 3 young women from Quebec there also who wanted to buy a few bottles of wine to take home but couldn't because they were just in VT for the day. They said you had to be out of the country (Canada) for 72 hours before you could bring alcohol back in.

Canadian jurisdictions make a fortune from alcohol taxes and from state control of liquor sales (LCBO is a major revenue earner for government of Ontario). So perhaps not surprisingly, there are a lot of restrictions on bringing alcohol back.

Ironic given how many Canadians used to make their living supplying the US with booze during Prohibition (Bronfman family for one). .

[bonghead]

You don't even need to live near an international border to get in on this. Live in Washington state near the border of Oregon. Work in Washington and pay no state income tax. Shop in Oregon and pay no sales tax.

Indeed. As well, a lot of NJ residents flood into NYC for work. I don't have the whole picture, but I know NJ living is cheaper in general.

[lakpr]

Indeed. As well, a lot of NJ residents flood into NYC for work. I don't have the whole picture, but I know NJ living is cheaper in general.

As one who fits the above description (NJ resident working in NYC), I can assure you that we pay New York state taxes on our income, and claim credit for those taxes when we file NJ tax returns. On top of that, NJ property taxes are the highest in the nation, on a modest $500K home I pay about $13K in taxes yearly.

The only thing we escape, perhaps, are the "city taxes" that someone living in New York City boroughs would have to pay.

[ElJay]

I couldn't see myself regularly crossing a country border unless I had no other choice. Last year I drove between the US and Canada and I got hassled going both ways: The Canadians literally looked under my seat cushions and tried to look at the photos that didn't exist on my camera. Coming back, the US did who knows what to my car and belongings, since my car was taken from me and I wasn't privy to the inspection. I guess a 30-something single male can't travel alone without being suspected of being a drug smuggling terrorist child pornographer.

[investomajic]

I couldn't see myself regularly crossing a country border unless I had no other choice. Last year I drove between the US and Canada and I got hassled going both ways: The Canadians literally looked under my seat cushions and tried to look at the photos that didn't exist on my camera. Coming back, the US did who knows what to my car and belongings, since my car was taken from me and I wasn't privy to the inspection. I guess a 30-something single male can't travel alone without being suspected of being a drug smuggling terrorist child pornographer.

Anyone who regularly crosses the US / Canadian border is almost surely a member of the NEXUS program. Being in such a program allows the participant access to dedicated NEXUS only lanes. Your inspection is usually fairly quick and painless. The only catch is - as you can imagine - you must submit to a fairly extensive background check by both countries' border / immigration agencies to be granted access to the program.

[Norris]

Canadian citizen needs TN1 (because of the NAFTA treaty) not the H1B. Same for Mexicans.

The TN only covers certain types of jobs. They tend to be technical jobs that require Masters degrees. For anything else you would need a H1B even if you are Canadian or Mexican. In addition, TN is a "status", not a "visa" and consequently they have different rules. Notably, the concept of US residency is treated differently--TN status is a non-resident status whereas H1B is a resident visa. This allows the holder to begin building up years of residency for a future citizenship application. however TN status is cheaper and usually easier to get.

Therefore one may choose to get an H1B instead of a TN even if one had a Masters degree and the job title fit the list.

The key is not U.S. residency or Canadian residency under the NAFTA. Some TNs reside in Canada and commute to their U.S. jobs, others reside in the USA. Same way with H-1Bs. Both are considered "Non-immigrants", meaning they do not intend to immigrate into the U.S. permanently. Can they change their intention? Certainly, and at that point they need to apply for a green card (Legal Permanent Resident) which, in turn, can be an avenue to U.S. citizenship if they so desire. Under U.S. Immigration law, immigrants and non-immigrants are two separate classifications.