The Canadian Snowbird
By Bryant Andrus
Profile: The Canadian Snowbird
TL;DR
- Tariff tensions cut Canadian travel to the US, but snowbirds heading south this fall face the same tax rules as always.
- The Substantial Presence Test can make a 130-day-a-year snowbird a US tax resident by year three; Form 8840, generally filed by June 15, is the protection.
- With the loonie near 72 to 73 US cents, US spending costs roughly 38% more than at par, so model the season’s real cost before you go.
If you spend your winters in Arizona, Florida, or anywhere else in the United States — typically four to six months — and your summers at home in Canada, August is the month to start thinking seriously about what the coming season means for your tax position. This year, the stakes are higher than usual.
The tariff war and the anti-American sentiment it sparked led many Canadians to reduce or cancel their US travel through the spring and summer of 2025. Statistics Canada data showed a significant drop in Canadian border crossings. But for committed snowbirds heading south in October or November, the planning questions are the same as always — and the consequences of getting them wrong haven’t changed.
The Day Count: Non-Negotiable
The US Substantial Presence Test is a mechanical calculation. It counts 100% of your current-year US days, plus one-third of your days from the prior year, plus one-sixth from the year before that. If the total reaches 183 (and you were present at least 31 days this year), the IRS may treat you as a US tax resident — taxable on your worldwide income. A snowbird who spends 130 days per year in the US accumulates approximately 195 weighted days by the third year of that pattern. That is over the line, and many snowbirds don’t realize they’re there until something triggers a review.
The protection is Form 8840 — the Closer Connection Exception. If you can demonstrate that your closer connection is to Canada (your home, your bank accounts, your social ties, your provincial health coverage, your CRA filings), you can override the substantial presence count — as long as you were in the US fewer than 183 days in the current year and haven’t applied for a green card. But Form 8840 must be filed with the IRS by the Form 1040-NR due date — usually June 15 of the following year (April 15 if you had US wages). Canadians who have been snowbirding for years without filing Form 8840 may have no protection in place. This is often fixable — but act proactively.
The Currency Math This Season
With the Canadian dollar hovering near 72–73 US cents, your US spending costs you roughly 38% more in Canadian dollars than it did when the dollar was at par. If your retirement income is in Canadian dollars — CPP, OAS, a provincial pension, RRIF withdrawals — and you’re spending US dollars in Florida or Arizona, the effective purchasing power decline over the past several years has been meaningful. August is a good time to sit down with your advisor and model what your US spending actually costs at today’s exchange rate, and whether any adjustments — in spending, in currency holding, or in the structure of your income sources — make sense before the season begins.
Ready to Talk?
Cross-border planning is time-sensitive and highly fact-specific. If any of the topics in this issue apply to your situation, we would welcome the conversation. State Bird Corp specializes in US–Canada cross-border tax, estate, and immigration planning for families and businesses on both sides of the border. Our team works with clients across the US and Canada — wherever your cross-border life takes you.
Sources
- https://www.irs.gov/individuals/international-taxpayers/substantial-presence-test
- https://www.irs.gov/pub/irs-pdf/f8840.pdf
- https://www.irs.gov/instructions/i1040nr
- https://www.npr.org/2025/08/21/nx-s1-5508461/fewer-canadians-visiting-us
- https://www.bankofcanada.ca/rates/exchange/annual-average-exchange-rates/
- https://www.x-rates.com/average/?from=USD&to=CAD&amount=1&year=2025
- https://www150.statcan.gc.ca/n1/daily-quotidien/250811/dq250811a-eng.htm
Sincerely,
The State Bird Corp Team
State Bird Corp
P: (602) 641-5996 · E: Info@statebirdcorp.com · W: statebirdcorp.com
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State Bird Corp is a management and financial consulting firm. State Bird Corp is not an accounting, legal or investment advisory firm. Cross-border planning is highly fact-specific. The strategies and topics described are general in nature, and readers should consult qualified specialists before taking any action. Any recommendation, inferences, or other guidance contained herein is meant for educational or general purposes and should not be relayed upon as specific advice for any person or business. Consult your legal, tax, and investment advisor for specific recommendation to your situation.