The Florida Condo That Followed Fatmir Home To Kapuskasing

The situation

Do I have to file taxes in the United States now, Fatmir asked us at our first meeting, and it took most of the file to answer properly, because the honest answer depended on facts nobody in the family had tracked carefully until that point. Fatmir, a construction project manager, and Hodan, a physiotherapist, had bought a modest winter condominium in Florida several years earlier, splitting their time between Kapuskasing and the south each year the way a lot of snowbird couples do, without giving much thought to where the line sat between a long vacation and something the tax authorities on either side of the border would call residency.

The property, now worth somewhere around $420,000, had been financed partly with help from Sagal, Fatmir's sister, who held a joint interest on title in exchange for contributing a share of the purchase price and using the unit herself for a few weeks most winters. The arrangement had worked informally for years: three people with overlapping but not identical interests in one property, none of it written down beyond the closing documents from the original purchase.

Fatmir and Hodan separated partway through the year, and the separation forced a set of questions that had been easy to avoid while the marriage held together. Who would keep using the Florida property, on what schedule, and whose name would eventually come off title, sat alongside a harder question neither of them had asked before: how many days had each of them actually spent in the United States over the past several years, and did that number matter more than they had assumed.

It mattered because Fatmir, in the year of the separation, had spent an unusually long stretch at the Florida property working remotely on a project bid while the marital home in Kapuskasing sat unsettled, pushing his time in the United States well past what he had spent there in any previous year. That single unusual year put him close enough to the kind of day-count threshold the United States uses to test tax residency that it could no longer be waved away as an ordinary snowbird pattern, and it arrived at the same time as a separation that made every dollar tied to the property, and every day spent near it, suddenly worth arguing about. Fatmir's question, asked almost offhandedly at the start of the meeting, turned out to be the single most important thing anyone had asked about the property in years.

What the law actually said

The United States tests tax residency for non-citizens partly through a day-count formula, commonly called the substantial presence test, that looks at time physically spent in the country over the current year and a weighted portion of the two years before it. Cross the threshold the test sets, and a person can be treated as a US tax resident for the year, which brings with it US filing obligations that go well beyond simply owning a vacation property there. Most snowbirds stay comfortably under that threshold by limiting their time south each winter, which is exactly why the rule rarely comes up for people who keep to an ordinary seasonal pattern.

Even a person who crosses the day-count threshold is not automatically treated as a US resident for tax purposes. There is a further exception, generally called the closer-connection exception, available to someone who spent fewer than half the year in the United States, maintains a genuine tax home elsewhere, and can show stronger ties, family, property, community, and habitual residence, to that other country. Claiming it requires a specific filing made within the deadline the rules set, though, not simply an assumption that ties to Canada would be obvious to anyone reviewing the file.

On the Canadian side, residency works differently and does not simply mirror the US test. A person can remain a Canadian resident for tax purposes based on the ties they maintain here, regardless of how many days they spend elsewhere, and the Canada-US tax treaty includes its own tie-breaker rules for the rare case where a person might otherwise be considered a resident of both countries at once, looking in turn at where the person has a permanent home, where their closer personal and economic relations lie, and other similar factors.

None of this had been reviewed while Fatmir and Hodan's marriage was intact, because neither of them had ever crossed a threshold that made it necessary. The separation year changed that for Fatmir specifically, and it also raised a separate, related question about Sagal's own time at the property, since her visits, while shorter, had never been tracked either, and the family had no record establishing that any of the three of them fell clearly on one side of the US filing line or the other. Answering Fatmir's original question meant working through both countries' rules together, rather than assuming a clean answer existed on either side alone.

What we did

1. Reconstructed Fatmir's actual day counts in the United States for the current year and the two years prior. We worked from flight records, credit card statements, and the property's own utility and access logs to build a defensible day count, since an estimate based on memory would not have withstood scrutiny if the filing was ever questioned by either country's tax authority.
2. Confirmed Fatmir's presence crossed the substantial presence threshold for the separation year specifically. Once the reconstructed days were in hand, we ran the weighted formula against the two prior years and confirmed the current year alone pushed him into the range where a US filing obligation, or at minimum a formal exception claim, was required rather than optional, a conclusion we would not have reached without the reconstructed count.
3. Prepared and filed the closer-connection exception claim within the applicable deadline. Because Fatmir still spent fewer than half the year in the United States and retained clear ties to Kapuskasing, including his ongoing employment, his home, and his community connections, we assembled the supporting documentation and filed the exception claim to keep him from being treated as a US tax resident for the year.
4. Reviewed Sagal's separate day-count exposure and confirmed it fell safely below the threshold. Rather than assume her shorter, more sporadic visits were automatically fine, we reconstructed her time at the property as well and confirmed her exposure was minimal, which let the family rule out one source of complication early in the process instead of leaving it as an open question hanging over the negotiation.
5. Negotiated with Hodan's side over the property's future use and eventual disposition. With the immediate US filing risk addressed, we turned to the practical question of who would keep using the property and on what schedule, which required direct negotiation given the separation, and we proposed a buyout structure, valued at roughly $150,000 to reflect Hodan's share of the property's current worth, that would let Fatmir retain the unit while compensating her fairly.
6. Adjusted the negotiating position when Hodan's side reversed its initial stance midway through discussions. Hodan had initially indicated she wanted no ongoing interest in the property and would accept a straightforward buyout, then later, after speaking with her own advisor, pushed instead for continued shared use during winters, which required us to rebuild the proposed arrangement around a shared-use schedule rather than a clean buyout.
7. Documented a revised shared-use and cost-sharing arrangement among all three owners. We drafted terms addressing who would use the property in which months, how carrying costs and property taxes would be split, and how each person's future day count would be tracked going forward, so the same uncertainty that had triggered the original scare could not quietly resurface in some later year without anyone noticing.
8. Set up an annual day-count check-in for Fatmir going forward. Since a single unusual year had been enough to create exposure once, we recommended Fatmir review his running day count with us each fall, before winter travel began, rather than waiting until an unusual year had already happened and looking back at it only once a problem had already formed.

The outcome

The closer-connection exception was accepted, and Fatmir was not treated as a US tax resident for the separation year, avoiding the more burdensome filing obligations, and potential double taxation exposure, that a full US residency finding would have created. Sagal's exposure was confirmed as minimal and required no further action beyond the day-count review itself, giving her the certainty she had not had before the review that her own occasional use of the property was not creating a hidden filing problem of her own.

The property outcome was not what Fatmir had originally hoped for. He had wanted sole ownership through a buyout of Hodan's interest, cleanly separating the property from the rest of the separation. Once Hodan's position shifted toward continued shared use, the final arrangement instead left all three parties with an ongoing interest in the property and a documented schedule for using it, which meant Fatmir did not get the clean break he had asked for at the outset.

The result was a genuine compromise rather than a win for either side. Fatmir avoided the tax exposure that had brought him to us in the first place, and the family avoided a forced sale or a contested legal fight over the property during an already difficult year, but the shared-use arrangement meant Fatmir would continue navigating a jointly held property with his estranged spouse and his sister for the foreseeable future, tracking his own days there carefully each year to make sure the exception claim would hold up again if his circumstances changed. Answering his original question honestly meant telling him that the tax risk was manageable but the property arrangement itself was not going away, which was not the simple yes-or-no answer he had been hoping for when he first asked it, but it was the accurate one, and knowing it early let him plan around it rather than being surprised by either country's tax authority months later.

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