TN Visa Taxes: Canadians Working in the U.S.
Why TN workers usually become U.S. tax residents, the first year, and the Canadian departure
Reviewed by the Fairlight Accounting cross-border tax team — U.S. & Canadian Tax Desks
TN status lets Canadian professionals work in the United States, but tax follows the substantial presence test, not the visa. A Canadian on TN status working in the U.S. most of the year becomes a U.S. tax resident, taxed on worldwide income from the residency start date, with a dual-status or elected full-year first-year return.
On this page
The tax picture
| Question | Answer (2026) |
|---|---|
| Does TN status make me a U.S. tax resident? | Not by itself — the substantial presence test does; a full-time TN worker who arrives by early July usually meets it in the first year (days you regularly commute from a home in Canada don't count) |
| When does U.S. residency start? | Generally the first day present in the year the test is met (the dual-status guide) |
| What's taxed? | Worldwide income once resident — including Canadian bank interest and investment income |
| FBAR and Form 8938? | Yes, once you're a U.S. resident — FBAR if your non-U.S. accounts total more than US$10,000 at any time in the year; Form 8938 above US$50,000 at year-end or US$75,000 at any time (single, living in the U.S.; double for joint filers) |
| Social security? | U.S. FICA on U.S. wages, unless a Canadian employer seconds you with a certificate of coverage (the totalization guide) |
State tax
Your work state taxes the wages — Florida has none, while New York, California, and others tax both wages and, once you're a resident there, worldwide income. TN status requires non-immigrant intent, which doesn't affect tax residency.
The Canadian side
Leaving Canada to work in the United States usually ends Canadian residency if your home, spouse, and dependants move with you (the factual residency guide) — triggering the departure tax on most non-registered property (the departure tax guide). Keeping significant ties in Canada can leave you a dual resident, with the treaty's tie-breaker deciding (the Form 8833 guide). Close or plan around the TFSA before you become a U.S. resident (the TFSA for non-residents guide).
Visa eligibility and status questions are for an immigration lawyer; this article covers the tax side.
Frequently asked questions
Am I a U.S. tax resident on a TN?
Usually, once you meet the substantial presence test — typically in your first full working year.
Do I file a dual-status return?
For the first year, unless you elect full-year residency with a spouse.
Does Canada still tax me?
Not on worldwide income once you've ended Canadian residency — but the departure tax applies when you leave, and Canadian-source income such as dividends and rent stays subject to Canadian non-resident tax.
Do I report my Canadian accounts?
Yes — FBAR and possibly Form 8938 once you're a U.S. resident.
Official sources
U.S. Citizenship and Immigration Services explains: “TN nonimmigrant classification permits qualified Canadian and Mexican citizens to seek temporary entry into the United States to engage in business activities at a professional level.” — U.S. Citizenship and Immigration Services, TN USMCA Professionals, https://www.uscis.gov/working-in-the-united-states/temporary-workers/tn-usmca-professionals
The IRS explains: “You were physically present in the U.S. on 120 days in each of the years 2023, 2024 and 2025. To determine if you meet the substantial presence test for 2025, count the full 120 days of presence in 2025, 40 days in 2024 (1/3 of 120), and 20 days in 2023 (1/6 of 120).” — Internal Revenue Service, Substantial presence test, https://www.irs.gov/individuals/international-taxpayers/substantial-presence-test
Next step
Fairlight Accounting is a cross-border accounting and tax practice with a U.S. Tax Desk and a Canadian Tax Desk. Our U.S. Tax Desk and Canadian Tax Desk handle first-year returns for TN workers, Canadian departure returns, and FBAR and Form 8938 setup. See pricing or book a call.
Cross-border taxes, handled in one place
U.S. and Canadian filings prepared together by our U.S. and Canadian Tax Desks.
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