I think we're talking at cross-purposes here.
CCRA (the Canadian version of IRS) considers lottery wins,
etc as non-taxable.
CANADIANS don't pay tax. Thus no paperwork required. I can
state this first-hand as I (being a Canadian) had a
significant win in Ontario's mega video poker tournament
last November. They offered me cash or a cheque. Did not
ask for my Social Insurance Number. I don't expect to have
to pay any. I'm doing this year's return soon - if my tax
accountant tells me otherwise, I'll let you know.
So, let me reiterate and clarify from an American
viewpoint, since most of this readership is American;
Gambling winnings are not taxable in Canada - ie - to the
Canadian government. No paperwork (like your W2-G) is done.
Apparently your IRS wants a piece of your winnings even if
you didn't win it in the US.
As far as I know, if a US citizen wins in Canada, there is
still no paperwork done. Can any of you verify this?
Presumably, it's up to each American citizen to obey their
laws and voluntarily disclose such out-of-country winnings,
be they in Canada or Timbuctoo.
So, if you're American
- win in USA, you get W2-G'd.
- win elsewhere, you must report it to the IRS.
If you're Canadian,
- win in Canada, it's tax-free.
- win in USA, you get W2-G'd and tax witheld***.
- to get your witholdings back you must apply to the IRS.
- if and when you get the refund, it's not taxable
in Canada.
*** On the second point, there may be some recent changes;
Last month I heard (third-hand) of a Canadian who owns and
races thoroughbred horses. He often runs them in Maryland,
and does parimutuel betting.
The story went that while he USED to routinely have 30%
witheld from his large wins, this is no longer the case.
Apparently there have been some recent changes to the
International Tax Treaty between the two countries. I
gather they still W2-G him, but when they see his Canadian
ID they no longer withold the tax.
Anyone here know anything about this?
Brian
···
--- "John.G.Zaroff" <John.G.Zaroff@delphi.com> wrote:
Brian Lavoie wrote .....
>>Gambling winning in Canada are tax-free.
Not true. All winnings are taxable. Canada just doesn't
issue W2-G forms.
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