tax saving tips for 1099 / W2 / Canadian corporation

[tparvaiz]

Hi,

I am in Illinois and working on a contract. will be expecting to make 150k this year (and probably 300k+ next year).

I do have an option to get my salary split on 1099 or on W2 or collect it in Canada (under my Canadian corporation).

can you please advise cost savings tips

Thanks in advance

[Critter-3]

This nameless faceless public forum is not a good place to get tax planning advice ... I highly recommend you seek local professional assistance who is knowledgeable in international corporate taxes.  

[tparvaiz]

I agree, that was my plan anyways. I wanted to do some research on my own before engaging experts.

Please share your suggestions

Thanks

[Opus 17]

In general, if you are a US citizen living anywhere in the world, or a US green card holder living anywhere in the world, or an alien living in the US more than 183 days of the year and passing the substantial presence test, then you’re required to file a US tax return and pay income tax on all your worldwide income.  If you are a resident of Illinois, then you will be required to file an Illinois state tax return and pay Illinois tax on all your worldwide income.

sometimes, a corporation that is paid in a foreign country can leave that money in the foreign country and not pay US tax on it. However, the IRS expects that the corporation pay you a fair salary for the work that you do, and that salary will be taxable in the United States.

if you want specific advice beyond those basic concepts, or if you think there is a way to exploit your corporate status to reduce your tax, you will need to see a tax professional.