well…sometimes life just deals you a raw hand. and sometimes, that’s the only explanation there is.
Many of you are aware that the reason that we don’t come back to the states on more occasions (okay, every weekend if we had our way) is that if we are in the country more than 34 days in a calendar year we essentially get taxed by both countries. This is one of the many tax laws related to working abroad that we researched diligently and spent ample time in calls with our accountant about before deciding to move to Canada. After weeks of investigation and research, and after hearing from our accountant that we should essentially expect the same thing from a tax return in Canadia as we did in the states- we pulled the trigger and moved to Vancouver.
Many of you are also aware of our extreme savings plan. We spent all year tracking our days in the states and tracking every penny of our spending to ensure that the savings plan was carried out, and with the expectation that our tax return would add another 15k-20k to the pot. We have been taking maximum withholdings for several years and adding our tax return to our savings, then paying off debt pretty soon after receiving the check from uncle sam. Last week we got the crushing news from our accountant that he had “made a mistake”.
That mistake was apparently forgetting that deductions are handled differently in Canada than the states. So while all of our real estate losses in the states account for a hefty return, they mean nothing to our taxes here; meaning said hefty return plummets to, well …ZERO. I cant tell you what a blow this has been to our state of minds and our emotional well being. In fact, it is only two weeks later that i can even write about the event without extreme anguish (and maybe a bit of anger).
It could have been worse, of this we are well aware. He could have messed up on the number of days in the states, and we could owe full taxes to both countries…meaning we would be writing a check right now and actually losing money from the savings we have worked so hard to accrue. But to us, after spending a year expecting the money as part of our plan, adjusting the plan accordingly and doing everything needed and making every excruciatingly hard decision to keep on pace for our savings goals…this simply felt like a kick in the groin.
But, as i said, sometimes life deals you a bad hand- and sometimes they aren’t followed by an equally good one (we indeed, did not win the lottery to make up for the event). And when that happens, you do all any of us can do – put the past in the rear view mirror and focus on the road ahead, and those things that you can control. And that, is exactly what we are doing. Our plans will have to change and our timelines adjusted, and certainly this will be a factor in any future discussions about how long to remain in canada…but life goes on, and so