Hello. I originally posted this in the Case study section but thought I'd perhaps get more response in the Canadian Tax section. Below is my situation I'm interested in what people would in my shoes.
My situation
Me: 40, UK and Australian citizen
Wife: 38 Canadian & Australia citizen
Children: 2 & 4
We live and work in NY as US-tax residents having moved here a little over a year ago, previously lived in Australia.
Gross Salary per month $33.5k
Pre tax deductions (monthly)
FSA Dependent Care $417 max $5000k allowance
Healthcare $429
HSA $265 max for annual family allowance
$401k $2620 max for annual contribution
Total $3731
Net income $15.5k/month
Expenses (monthly)
Child care $3267 full time 5 day, 2 children
Property taxes $1220
Car lease+fuel $833 (two cars)
Vacation $500 (conservative budget $6k for annual vacation domestic and overseas)
Utilities $458 Gas, water electric
Groceries/Food $1380 includes eating out 2 month, lunch weekdays
Insurance $313
Other $700 (internet, TV subscription, gym, kids sports activities, clothes)
Total $8671
Net income after expenses (monthly) $6,829
Assets
House paid off $950k
Cash $110k
401k $58k combined balance
Vanguard brokerage $31k
Company shares $93k
Real estate crowdfunding $44k
HSA $1k
Subtotal $1.287m
Overseas 401k $350k in Australia => can’t access till 65
Overseas Investment Property: $1.75m (valuation), mortgage $800k, Cash in offset account $800k => no interested owed on mortgage, like a line of credit set up.
Overseas sub-total $2.1m
Net Rental income after all expenses $3400/month
Liabilities - None beyond the overseas mortgage
Some of you may look at this and think this guy is already into FIRE status and why is he here. The expenses are ridiculously high, this is partly living in an expensive NY suburb due to my work location and clearly some luxury expenses. We’ve always been savers and yes we have high paying jobs which has helped a lot. My wife and I started from nothing literally, both from working class families and have built this up over 15 years. Clearly, luck has played a role with real estate appreciation along the way. Although our asset position is very strong, there’s not a huge amount of passive income except from our overseas investment property. We know our stock holdings is very low and this is something we are aiming to build up over the next few years for diversification.
Here are our plans and some questions I would like to pose:
i) Move to Canada permanently 'early retirement' in 4-5 years => this is mainly for family reasons. How can I optimise my investment choices while based in the US over the next 4-5 years before making that move? For example, does is make sense for me to max out 401k and HSA? Would options like Roth Conversion ladder and access HSA without penalty even be possible or make sense if I'm not in the US?
ii) We have the option of applying for a US Green Card does it makes sense to do this?
iii) Despite alternative having a large part our Networth in real estate, we are very interesting in building a Property Investment portfolio. Does it make sense to investment in US Real estate if we know we are leaving? The size and opportunity of the US market is the main reason I tend to favour the US RE market. We have also considered the Canadian RE market too.
iv) How and when to dispose of our Australia investment property and minimise the potential Capital Gains Tax.
v) We have a huge passion for travel and we would like to consider travelling with our children and home schooling them for 1-2 years, perhaps before moving to Canada.
vi) What else would you change?
I appreciate that this may be difficult question to answer and more suited to wealth management/cross border experts, if anyone has any contacts on firms/individuals who could help that too would be appreciated.
Welcome any thoughts or questions you may have.