Those making this annual migration have earned the nickname snowbirds in honor of singer Anne Murray's song of the same name. However, the delight of avoiding ice and snow carries some sombre tax responsibilities.
Snowbirds have two countries worth of laws and taxes to deal with.
To maintain seasonal resident status, snowbirds must count the days carefully. Snowbirds can avoid responsibility for U.S. income tax by filing the proper forms to prove their close connections with Canada or to establish Canadian residency under the Canada-U.S. Income Tax Treaty. If you plan to join the flight south of the border, verify the details with your financial adviser or else an American tax bill may make this an expensive trip. Extended health insurance is vital, even if you are only popping over the border for a short stay. Even with discounts, extended stay policies are expensive.