Every winter, thousands of Canadians head south, and many decide to buy instead of rent. But US property ownership for Canadian snowbirds involves much more than finding the right vacation home. Buying real estate in the United States means navigating two legal systems and a different set of financial rules.
None of this is meant to scare you away from buying a home in the US. It just means there’s more to think about than the listing price or the weather. Before making an offer, take a close look at four key areas: how long you can stay in the US, what happens when it’s time to sell, how you should own the property, and what it will actually cost to keep year after year.
1. How Many Days Can You Spend There?
The Immigration Limit vs. The Tax Limit
One of the biggest surprises for Canadian snowbirds is that the IRS doesn’t use the same rules as US border officials.
While Canadians can stay in the US as visitors for up to 182 days within a rolling 12-month period without a visa, the IRS uses the Substantial Presence Test (SPT) to determine tax residency. The test looks at three years of travel by counting every day spent in the US during the current year, one-third of the days from the previous year, and one-sixth of the days from two years earlier.
If you’re in the US for at least 31 days during the current year and your weighted total reaches 183 days, you may be considered a US tax resident. Since arrival and departure days both count, it’s easy to underestimate how quickly those days add up. For example, spending 120 days a year in the US keeps you just below the threshold, while staying 122 days a year pushes you over it.
The Relief Forms
Crossing the 183-day weighted threshold doesn’t automatically mean you’ll owe US tax on your worldwide income.
If you’ve spent fewer than 183 actual days in the US during the current year, you can usually file IRS Form 8840 to claim the Closer Connection Exception. The goal is to show that your life is still based in Canada. The IRS looks at things like where your home is, where your family lives, where you bank, where you’re licensed to drive, and where you receive healthcare. Just don’t miss the filing deadline. Form 8840 is generally due by June 15 of the following year, and filing late can cost you the exception.
If you’ve spent 183 days or more in the US during the current year, that option disappears. Instead, you’ll need to rely on the Canada-US tax treaty by filing Form 1040-NR and Form 8833.
A Pending Change Worth Watching
Some Canadian snowbirds are hoping for a rule change, but for now, nothing has changed. The Canadian Snowbird Act (H.R. 3070), a bipartisan bill introduced in the US House in 2025, would allow qualifying Canadians aged 50 and older who own or lease US property to stay for up to 240 days a year without a visa instead of the current 182-day limit. However, as of mid-2026, the bill remains in committee and has not become law.
One More Form for Your Bank Account
If you open a US bank account to pay for property expenses, be sure to complete Form W-8BEN. Without it, US banks are required to withhold 30% of the interest your account earns. Once submitted, the form is typically valid for three calendar years before it needs to be renewed.
2. What Happens When You Sell (FIRPTA)
Buying a US property is often the straightforward part. Selling it can be much more complicated. If you’re a non-resident, the Foreign Investment in Real Property Tax Act (FIRPTA) requires the buyer to withhold a portion of the sale proceeds and send it to the IRS.
Under FIRPTA, the buyer is legally required to withhold a percentage of your gross sale price and remit it to the IRS within 20 days of closing.
FIRPTA provides limited exceptions to the standard 15% withholding requirement. A reduced withholding rate of 0% or 10% may apply if the buyer certifies that they, or an immediate family member, will occupy the property as a residence for more than half of the days it is used during each of the first two years of ownership. These reduced rates are not available when the purchaser is a corporation, LLC, or partnership.
The biggest issue for many sellers is that FIRPTA withholding is calculated based on the gross sale price rather than the taxable gain. As a result, the amount withheld can greatly exceed the seller’s actual tax liability.
To reduce that amount, sellers can file Form 8288-B before closing and request a withholding certificate based on their estimated tax liability. Since IRS processing often takes several months, early planning is important.
3. How You Hold a Title Matters More Than You’d Think
The Corporate Ownership Trap
Under the current rules, a shareholder who uses a corporately owned US vacation property without paying fair market rent receives a taxable shareholder benefit under subsection 15(1) of the Income Tax Act. The benefit is included in the shareholder’s personal income, while the corporation cannot claim an offsetting deduction. This creates an inefficient ownership structure that can result in tax being paid at both the corporate and individual levels.
The Revocable Trust Mismatch
A US lawyer may suggest a Revocable Living Trust because it can help your family avoid US probate. The catch is that Canadian tax authorities may not see it the same way.
The IRS generally treats the trust as if it doesn’t exist for tax purposes. The CRA may take a different view if you, as a Canadian resident, control the trust. That can turn the trust into a Canadian resident trust with extra filing requirements, potential tax on income that remains in the trust, and the 21-year rule, which can trigger a tax bill on unrealized gains every 2 decades.
What Cross-Border Specialists Use Instead
To avoid the potential problems created by traditional ownership structures, cross-border estate lawyers often recommend more tailored planning strategies. One approach is a Cross-Border Trust, designed to remain tax-transparent in the US while reducing the risk of unintended Canadian tax consequences.
This strategy is often paired with a dual will structure: a separate US-situs will that governs the property under state law, alongside a Canadian will that handles assets at home. Having both wills allows the two estates to move through probate at the same time instead of one after the other. Naming a US-based co-executor can also help avoid the bonding requirements that some US courts place on foreign executors.
4. What the Property Costs to Hold
In Florida, insurance has become a major part of the housing affordability equation, alongside the mortgage itself. While the Florida Office of Insurance Regulation reported a statewide average baseline premium of $3,791 as of January 2026, the true cost of coverage can be much higher once additional protections are included.
Zoocasa’s analysis of the insurance-to-mortgage ratio found that fully loaded insurance costs, including windstorm, hurricane, and flood coverage, average closer to $8,491 annually across the state. That means insurance alone can represent a significant share of a homeowner’s monthly housing costs, especially in coastal markets.
There are signs of improvement. Citizens Property Insurance approved an average 8.7% rate reduction for 2026 renewals, offering the first meaningful relief in years. However, the impact will not be equal across all properties. Homes in coastal areas, older buildings, and high-value waterfront communities remain among the most expensive to insure. For buyers, the right approach is to budget for a realistic range rather than rely on a statewide average.
Beyond insurance, plan for:
- Municipal and county property taxes
- HOA or condo fees, plus potential special assessments
- Cross-border property management, if you’re not there year-round
- Utility and maintenance reserves for a home sitting empty part of the year
Financing as a Non-resident
Programs such as RBC’s US HomePlus and BMO’s Gateway allow eligible Canadians to qualify using their Canadian credit profile rather than starting from scratch in the US. Through these bank programs, down payment requirements are typically around 20% for a primary residence or vacation home and about 25% for investment properties.
Buyers who use foreign-national or DSCR mortgage products outside these programs may face higher down payments, often between 25% and 40%, along with interest rates that are typically higher than those available to US borrowers.
Is US Property Ownership Right for You?
The rules around buying US real estate may seem complicated, but they should not discourage Canadians from pursuing a winter home. US property ownership for Canadian snowbirds can work well when buyers approach it with the same care they would use for any major financial decision.
The key is getting the fundamentals right from the start. With proper planning, a cross-border home can deliver the lifestyle benefits buyers are looking for without becoming an unexpected financial burden.
Whether the framework points you toward a US purchase or a Canadian one instead, Zoocasa can help you compare markets on your terms. Start your search today.
