Moving From Quebec to the US: What Happens to Your Taxes?

Quebec is the only province that administers its own personal income tax. When you move from Quebec to the US, you deal with three tax authorities: the CRA (federal T1), Revenu Québec (provincial TP-1), and the IRS (Form 1040 or 1040-NR). The Quebec layer adds complexity that does not exist for moves from Ontario, BC, Alberta, or any other province, because Revenu Québec has its own filing, its own credits, its own withholding rules, and its own departure mechanics.

What returns do I file in the year I leave?

In the departure year, you file three separate returns, one for each tax authority that has jurisdiction over your income:

• Federal T1 (CRA). Worldwide income to the date of departure, Canadian-source income for the remainder. The departure tax deems you to have sold most capital property at FMV on your departure date. The T1 includes the T1161 (List of Properties by an Emigrant of Canada) and Schedule 3 for the deemed dispositions.
• TP-1 (Revenu Québec). Same concept: Quebec-source income for the full year, worldwide income to the departure date. The TP-1 uses Quebec-specific schedules for the capital gains from the deemed disposition. The Quebec abatement (the 16.5% reduction on basic federal tax that compensates for Quebec collecting its own tax) ends on the departure date. If you move mid-year, the abatement is prorated.
• US return (IRS). Either a dual-status return or a full-year return (if you make the first-year election). The US return reports worldwide income from the date you become a US resident (or for the full year if you elect). The FTC on the US return credits the combined federal and Quebec tax paid on overlapping income.

How is the TP-1 different from other provinces?

In every other province, the provincial tax is a calculation on the T1, administered by the CRA. You file one return, and the CRA handles the provincial portion. In Quebec:

• Separate filing. You file the TP-1 directly with Revenu Québec, by mail or electronically.
• Separate slips. Your Quebec employer issues Relevé 1 (RL-1) instead of T4 for employment income. Relevé 3 (RL-3) replaces T5 for investment income. You need both the federal slips (from the CRA) and the Relevé slips (from Revenu Québec) to complete both returns.
• Separate assessment. Revenu Québec issues its own notice of assessment, separate from the CRA’s.
• Different credits and deductions. Quebec has its own versions of many credits (the Solidarity Tax Credit, the work premium, the medical expenses credit with different thresholds). Some federal credits do not exist in Quebec or have different rules.
• QPP instead of CPP. Quebec workers contribute to the Quebec Pension Plan (QPP) instead of the Canada Pension Plan (CPP). The contribution rates are slightly different. When you move to the US and start paying into US Social Security (FICA), the totalization agreement coordinates QPP and Social Security credits the same way it coordinates CPP.
• QPIP. The Quebec Parental Insurance Plan (QPIP) is a separate payroll deduction for parental and maternity benefits. It ends when you leave Quebec.

What about Quebec’s own departure rules?

Quebec piggybacks on the federal departure tax. The deemed disposition under ITA 128.1(4) applies for both federal and Quebec purposes. The capital gains from the deemed disposition are included in both the T1 and the TP-1. Quebec does not have an additional departure tax on top of the federal one, but the Quebec tax rate on those gains may differ from the federal rate.

• Quebec’s top combined marginal rate (federal + provincial) for 2024 is approximately 53.31% on ordinary income, making it the highest in Canada. The effective rate on capital gains (at the 50% inclusion rate) is approximately 26.65%. This means the departure tax on appreciated assets can be significant, and the FTC available on the US return must account for both the federal and Quebec portions of the Canadian tax.

What happens to my RRSP, TFSA, and RESP?

The same rules apply as for any Canadian leaving for the US:

• RRSP. You can keep it. Withdrawals as a non-resident are subject to Part XIII withholding (25% lump sum, 15% periodic under the treaty). The RRSP withdrawal strategy covers the options.
• TFSA. Contributions are prohibited after you leave. The account can remain open, but any growth may be penalized under the non-resident rules. The US treats it as a potential foreign trust. Most people collapse it before the move.
• RESP. Contributions can continue if the subscriber has a SIN, but the RESP cross-border reporting burden (FBAR, Form 3520) applies once you become a US person.

What about Quebec health insurance (RAMQ)?

The Régie de l’assurance maladie du Québec (RAMQ) coverage ends on the date you leave Quebec, or at the end of the month in some cases (the exact rule depends on whether you notify RAMQ of your departure). Unlike some provinces that provide a grace period, Quebec’s coverage termination can be immediate upon establishing residence elsewhere.

You need US health insurance starting on your arrival date. If you are moving for employment, the employer’s plan typically starts on the first day. If you are self-employed or between jobs, you have a Special Enrollment Period to enroll in an ACA marketplace plan.

What about Quebec’s specific tax rates?

Quebec has its own progressive tax brackets, separate from federal:

• 14% on the first $51,780 (2024)
• 19% on $51,780 to $103,545
• 24% on $103,545 to $126,000
• 25.75% on income over $126,000

Combined with federal rates (net of the Quebec abatement), the top marginal rate exceeds 53%. This is higher than Ontario (~53.53% top rate) and substantially higher than Alberta (~48% top rate) or British Columbia (~53.5% top rate). The departure tax on a large unrealized gain can produce a significant tax bill, and the FTC on the US return must be large enough to absorb it.

What should I do next?

If you are moving from Quebec to the US, start the Quebec departure process early. Obtain your Relevé slips from Revenu Québec. File the TP-1 in addition to the T1. Collapse the TFSA. Notify RAMQ. Run the departure tax estimate on all appreciated assets to determine the combined federal and Quebec tax, and model the FTC on the US return to confirm it absorbs the Canadian tax without creating excess credits.

• Departure tax when leaving Canada, the deemed disposition mechanics
• Moving from Ontario to Florida, the Ontario version
• Moving from BC to California, the BC version
• Moving from Alberta to Texas, the Alberta version
• Dual-status vs full-year election, the US first-year filing choice
• Cross-border tax accountant in Montreal, the Quebec-specific geo page

This guide is general information, not tax advice for your specific situation. Which points apply, and how, depends on your facts.