September has been an awful moment for my wallet, not because of spending but because clients and employers can't pay American me in Canada. Previously, a client had me sign up for a Chase service which I connected to my US account with another bank. Chase recently decided to say goodbye to freeloaders, like me, who weren't doing any banking with them. So began a month of stress, frustration and absolute disgust with customer service, computerized systems and the US, in general.
I'm a US citizen, but a legal resident of Canada. No matter what I do, I always have to file US taxes. Every other country in the world, has you file in the country of residence. Not our beloved USA. Thus, I changed my official address at my US bank account to Canada. I didn't want to appear suspicious by having a US address and also claiming residency in Canada. My bank assured me that they were fine with this arrangement.
My US bank account is a nice thing to have for traveling back home to visit. It's also necessary to pay off my student loans. Thus, I was getting paid by my US clients into that account and paying my student loans. I'm very thankful that friends in my professional network have stuck with me and cho se to employ me despite the move to Canada. It can complicate things for them and they're taxes as well.
While my problems this week are somewhat tax related, it really just comes down to getting paid. Despite having these computers in our pockets, banking is still in the dark ages. Well, I should rephrase that. American banks are in the dark ages. The security of the chipped credit card just reached the US last year? It's been a staple in Canada and other countries for close to a decade. (Plus, the US chip system never seems to ask me for my pass code. That's one of the most secure functions of it!) We hear about fabulous apps to send/receive money like Square Cash or Google Wallet, but they're US only.
"Where's the problem? You have a US account."
My address is Canadian. It's like living in a post Y2K world, where computer systems were never updated to do a 4-digit year. I literally cannot type in my postal code. I cannot choose my province from the dropdown menu. And "Heather," Google's help desk person who obviously has English as a second language because she's most likely not working at the Google campus, cannot help me because that's not in her script. Indeed, another friend talked to a family member who is at Square to help me out, and it was also a no go. Many friends suggested Freshbooks. It turns out they're based in Canada, surely they can help! "When you add your bank account, just put in a US address, not a Canadian one." Why didn't I think of that? Just lie. I'm sure that will work out for me. "News at 11: IRS Finds Canadian Terrorist Cell Using Freshbooks."
Meanwhile in Canada and Europe, I've seen a number of methods to move money across borders. Here, there a number of immigrants, like me, sending money home. Wire transfer services, apps and websites can move money just about anywhere. The exception is the US. Obviously, Europe has mostly open borders and these things are a daily occurrence with your neighbor. The US and Canada are neighbors, right?
The Tax Shelter That Is Chris
The reason I am having so much trouble is because I'm a person, not a corporation. Wait, aren't corporations people now? Does it work the other way around? Am I Burger King? Did I move to Canada to escape the evil US taxes? Well, since I now have to file for taxes in two countries, hell no. Yet, that's really how I am being treated, as a criminal.
The assumption is that I fled to Canada to escape taxes. It wasn't love, happiness or any other ridiculous notion. I'm a US citizen, and complete criminal element. The thing that really gets me about the whole situation is that we live in this weird, new sharing economy. Again, sharing is in reference to the peons, us people at the bottom rung. The Uber drivers are so very happy to make their own hours and a living driving a car. The execs at the top of Uber are still playing the age old capitalism games and could care less about the sharing economy. Perhaps young startups begin with the sharing ideals, but they take on shareholders and fall into the well.
Fees, Fees, Fees A.K.A. PayPal
Search "don't use PayPal," or the classic "PayPal sucks" and you'll find a load of reasons to steer clear of them. You may even find a 14 year old rant by yours truly. I had a falling out with the service and have never used it or it's partner in crime, eBay, ever again. Guess what? It does actually work in Canada and the US. Despite my misgivings about the company, things are looking brighter, right? Setting the past aside, no. Things are probably going to get uglier.
When I made t-shirts for our podcast, Cotton Bureau only accepted PayPal, but wouldn't let me connect my account. It was that Canadian address issue again. Damn me for being an upright citizen and not lying. So, I signed up for a Canadian PayPal account.
My Canadian bank account says I can get a US account with their bank in the US and move money between the accouts without hassle. Sign me up! "No, you actually have to go to a US branch and sign up." Shoot me now. Instead, I opened a US dollar account here in Canada. Any US dollars I put in it are mine, without conversion! So, Canadian account plus Canadian PayPal, but payments in US dollars coming to a US dollar account! I win. Except for all of PayPal's fees that I can't list here because they're completely obfuscated on their site.
Oops. I celebrated too soon. It's a Canadian PayPal account. PayPal charges a fee for converting USD to CAD and vice versa. They really want that fee. Now, my option is to get paid, convert the USD to CAD and deposit it in the USD account which means another conversion by my bank. Or take the conversion into my CAD bank account. Tell me again, how I will pay my US student loans?
My Money, My Future, My Loyalties
As a freelancer, stress often comes from clients not paying your invoices. This was a whole new level of stress, not finding a method (in 2016!) to receive payment. Now, I brought this on myself. US friends reading this are thinking, "You're the one that moved there." My Canadian friends are wondering, "Why not get a Canadian job and ditch the US clients." Well, thank you for giving constructive advice, fake Canadian voices in my head. That's more helpful than the brash statement by the pompous American voice in my head.
A Canadian job would be pretty wonderful. I do what I do now based on opportunities and who I know. It's not based on me trying to avoid Canadian or US taxes. I don't mind pay taxes. Even before I moved here and had this amazing health care. Taxes give us roads, services and all sorts of things. Even if you don't agree with how the money is spent, you still owe it, in my opinion. Since I live in Canada, I owe that money to the government here, not the US government that assumes I must be a criminal for moving.
This whole episode has me seriously thinking about my US citizenship. What does it really afford me, aside from this hassle? I have family and friends back in the States, but I could still visit if I had Canadian citizenship. In the future, will my wife and I want to retire in the States? It's an option, but it's not looking very good right now.
If you read this far, hello. All of this just boils down to a reminder that Canada is a foreign country. As much as people around the world, and in the US, assume North America is basically the USA, it is simply not true. I would go so far as to say, we're not even that neighborly when it comes to money matters. Really, it's the difference between socialism and capitalism. Canada let me open a US dollar account and I can send money practically anywhere. The US doesn't want money to move outside its border.
If, for some reason, you enjoyed reading about my financial woes, you'll enjoy my next blog series. Riding the line between stupid and brave, I plan to post monthly income reports as I continue my career change journey. I don't really look forward to sharing how little I make. Yet I think it would be nice for others to see, a realistic look at writing articles rather than a carefully cultivated social media presence proclaiming that I am a successful entrepreneur.