Puerto Vallarta, Jalisco, Mexico - As our worlds come together and become more digitized and more integrated, we also become more transparent with our fiscal duties. Recently there have been many changes in each of our respective countries of residence's new and revised tax requirements.

For us that have been living in Mexico for many years, the changes have been to say the least, dramatic, but nonetheless, overdue. All of these laws have been implemented for the sake of complicating and exposing the money laundering practices that have gone unchallenged for such a long time.

What we all need to remember is that if we are paying taxes, we are making money. Below are links to the required tax forms for the US and Canada. As for the Mexican tax reforms, the most important to remember is that just like home, we have to pay taxes. The more we become informed about the regulations, like with everything else, the more we can try and find the best applicable formulas that keep our best interest in mind.

The Canadian form is the T1135.

Over the past year, the Canadian government has made it a priority to "crack down on international tax evasion and aggressive tax avoidance" and has, in doing so, proposed several changes to the Foreign Income Verification Statement (Form T1135).

According to the Canada Revenue Agency website, Form T1135 must be filed by most Canadian-resident individuals, corporations, or trusts that, at any time during a year, owned specified foreign property (including most types of income-earning property held outside of Canada, other than personal property and property used in carrying on an active business) costing more than $100,000.

Form T1135 must also be filed by partnerships that hold more than $100,000 in foreign investment property and whose non-resident members' share of income or loss is less than 90% during the reporting period. As we reported last spring, the changes to Form T1135 announced in the 2013 federal budget include:

• Revising the form by requiring taxpayers to provide more detailed information regarding each specified foreign property.

• Allowing the form to be electronically filed.

• Extending the normal reassessment period of the tax return if certain conditions are met.

• Improving the form filing process by reminding taxpayers, on their Notice of Assessment, of the obligation to file Form T1135, and by clarifying the filing instructions.

New Form T1135

Consistent with these proposals, the Canada Revenue Agency (CRA) has released revised Form T1135 which must be used for 2013 and subsequent taxation years. The new form calls for more detailed information requirements for each specified foreign property including:

• The name of the specific foreign institution, investment or other entity holding funds outside Canada.

• The specific country to which the foreign property relates.

• The cost of the property at the end of the year, the highest cost amount during the year and the income or gains generated from the foreign property, on a property by property basis.

However, there is some good news for those taxpayers who hold foreign property through Canadian brokerage and investment accounts. The new Form T1135 states that "where the reporting taxpayer has received a T3 or T5 from a Canadian issuer in respect of a specified foreign property for a taxation year, that specified foreign property is excluded from the T1135.

When the transitional relief was announced, the CRA also stated that the filing deadline for Form T1135 for the 2013 tax year will be extended to July 31, 2014 for all taxpayers, in order to provide further assistance in the transition to the new reporting requirements.

For more information on Canadian requirements, click HERE.

U.S. Tax Form 8938, which applies to foreign investments

The IRS has created a page on the IRS.gov website that contains links to Form 8938 information and instructions. Information about any future developments affecting Form 8938 (such as legislation enacted after its release) will be posted on that page.

What also needs to be clear is that we need to understand and comply with all of the federal requirements that have been implemented by our governments.

It is very important that you have sound and trustworthy counsel from you original country of residence as well as in Mexico. Living the dream is only a question of being prepared and leaving the surprise factor out of the equation.

If you are thinking about moving to Puerto Vallarta or purchasing vacation or investment property in the greater Banderas Bay area, contact Tropicasa Realty Agent Grace Ramirez at 322-294-1816 or grace(at)tropicasa.com.

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Since 1997, Wayne Franklin and his team at Tropicasa Realty have been a trusted name in Puerto Vallarta real estate. Tropicasa Realty is the region's representative for "The Leading Agents of the World" and with over 100 years of combined experience in real estate, all agents of the company are affiliated with AMPI. Wayne Franklin or any member of his knowledgeable team can be contacted in-person at their Romantic Zone Office - Pulpito 145-A at Olas Altas or in their San Marino Office - San Marino Hotel at Rodolfo Gomez 111-4. While in PV they can be reached at (322) 222-6505 or by calling 866-978-5539 (Toll-Free) from the U.S.

Click HERE to learn more about Tropicasa Realty, or visit tropicasa.com.