Cardinal Point Wealth Management Raises Awareness for Cross-Border Retirees Regarding 2025 Changes to Benefits Demanding Urgent Vigilance

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Toronto, ON - June 6,2025 - Cardinal Point Wealth Management, a leading crossborder financial advisory firm, today released a timely and important educational overview to help Americans living in Canada [https://cardinalpointwealth.com/cross-border-financial-and-tax-planning/u-s-citizens-living-in-canada/] and Canadians living in the US [https://cardinalpointwealth.com/canadians-living-in-the-u-s/] understand how new 2025 rules impact taxation and coordination of US Social Security, Canada Pension Plan (CPP), and Old Age Security (OAS) benefits. Drawing on four decades of bilateral agreements and recent legislative changes, Cardinal Point underscores practical steps retirees and nearretirees can take to avoid double taxation and maximize lifetime income.

Since 1984, the CanadaUS Totalization Agreement has allowed workers who divide their careers between the two countries to "totalize" contribution periods, making it easier to qualify for benefits on both sides of the border. While the legal framework is familiar, 2025 brings several new considerations. These include higherthanaverage US Social Security costofliving adjustments, the recent elimination of the Windfall Elimination Provision and Government Pension Offset for beneficiaries who also receive CPP, and enhanced electronic informationsharing between the Canada Revenue Agency (CRA) and the Internal Revenue Service (IRS).

Key Findings for 2025 Retirees

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Exclusive Taxation Rights Remain Intact: Under ArticleXVIII(5) of the Canada-US Income Tax Treaty, US Social Security is taxable only in Canada when the recipient resides north of the border, while CPP and OAS are taxable only in the United States when the recipient resides south of the border. In both cases, up to 85percent of the benefit is included in taxable income in the taxing country.

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Eligibility Gaps Can Still Be Closed: The 40quarter US requirement and CPP residency rules continue to be bridged by totalization. A US citizen with six years of covered earnings in the United States, for instance, can apply Canadian CPP credits to reach the 10year threshold for Social Security eligibility-though the benefit is calculated solely on US earnings.

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Reporting Obligations Persist: Dual citizens must still file annual returns with both agencies. Even when a treaty exempts the income from tax, Form8833 (TreatyBased Return Position) may be required to preserve the exemption.

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State and Provincial Surcharges Differ: California, New York, and several other US states conform to federal treatment of foreign pensions, but each applies its own marginal rates. Likewise, hightax Canadian provinces such as Ontario or Quebec will stack provincial levies on top of the federal inclusion rate.

Practical Planning Strategies

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Confirm Tax Residency Early: Remote work, seasonal migration, and extended travel can blur residency status. Maintaining clear daycount records and filing consistency prevents unexpected tax bills.

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Coordinate Claim Dates: Deferring CPP or OAS while commencing US Social Security-or vice versa-may improve aftertax cash flow, especially for families straddling the border.

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Leverage Currency Management: Holding accounts in both CAD and USD and timing conversions during favorable exchange rate windows can shield purchasing power against adverse currency swings.

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Integrate Healthcare Costs: Both Medicare premiums and provincial healthcare eligibility hinge on contribution history and residency. Aligning benefit start dates with medical coverage thresholds helps avoid coverage gaps.

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Seek Specialist Advice: Crossborder tax software cannot always account for treaty overrides, provincialstate interactions, or estatetax mismatches. Engaging a credentialed crossborder financial advisor increases the likelihood of accurate projections and compliance.

Elevated Urgency for Retirees

"Retirement decisions have always been highstakes, but 2025 adds a layer of urgency," saidKris Rossignoli, Senior Private Wealth Manager at Cardinal Point Wealth Management. "With the Social Security Fairness Act eliminating WEP and GPO reductions and governments exchanging data more seamlessly, retirees need to revisit plans they made even a few years ago. Our goal is to raise awareness so individuals can capture every dollar of benefit they have earned-without incurring avoidable tax."

Historical Context

Since the Totalization Agreement took effect on August1st,1984, more than 600,000 workers have relied on combined US and Canadian credits to qualify for retirement benefits. Although no comprehensive overhaul has been enacted since 2004, incremental updates-from electronic recordkeeping to refinements in survivor benefits-require vigilant monitoring. The 2025 environment reflects demographic shifts as baby boomers transition fully into retirement and digital nomads accumulate multijurisdictional work histories.

Looking Ahead

Both Ottawa and Washington continue to evaluate pension sustainability and crossborder labor mobility. Proposals under discussion-such as aligning CPP earlyclaim discounts more closely with US actuarial factors or expanding crossborder electronic filing waivers-could further streamline retiree compliance. Cardinal Point Wealth Management will continue to publish periodic briefs as new guidance emerges.

About Cardinal Point Wealth Management

Cardinal Point Wealth Management is an independent firm specializing in crossborder wealth management [https://cardinalpointwealth.com/cross-border-financial-and-tax-planning/u-s-citizens-living-in-canada/] for Americans living in Canada and Canadians living in the U.S. The firm's team of credentialed crossborder financial advisors integrates tax, retirement, and investment planning to help clients thrive on both sides of the border.

Disclaimer: This press release may contain forward-looking statements. Forward-looking statements describe future expectations, plans, results, or strategies (including product offerings, regulatory plans and business plans) and may change without notice. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements.
Media Contact
Company Name: Cardinal Point Wealth Management, ULC
Contact Person: Kris Rossignoli, Senior Private Wealth Manager
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Website: http://www.cardinalpointwealth.com/

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