Crossing Pay

USD 160,000 in Detroit, living in Windsor

A USD 160,000 salary working in Detroit, for a single filer living in Windsor, Ontario, leaves an estimated C$142,729 a year — C$5,490 every two weeks — after US federal tax, FICA, Michigan tax, Detroit city tax, the Canadian return, and the cost of converting the money to Canadian dollars at a big-five bank rate. That is an all-in effective rate of 34.1%.

United States

Gross pay$160,000
Federal income tax−$30,998
Social Security−$9,920
Medicare−$2,320
Michigan state tax−$6,549
Detroit city tax−$1,920
US net$108,293

Canada

Income reportedC$222,880
Federal + Ontario tax−C$75,960
Federal foreign tax credit+C$46,769
Ontario foreign tax credit+C$25,259
Still owing to the CRAC$3,932

Lost to bank spread, every year

C$2,816

What a big-five bank keeps on converting $108,293, compared with a low-spread transfer service. Against the mid-market rate — which nobody actually gets — the gap is C$4,191.

Take-home

C$142,729/yr

Per pay period

C$5,490

All-in effective rate

34.1%

Married, with a spouse earning nothing

Article XXV of the Canada–US treaty caps the US federal tax of a married Canadian resident. On the same USD 160,000, it takes US federal tax from $30,998 down to $21,959. What reaches a Canadian account is C$142,379 a year — C$350 less than the single filer above. Paying the IRS less does not mean keeping more: the Canadian foreign tax credit was already covering the bill, so the CRA collects what the IRS gave up, and converting the larger US net costs more in bank spread.

▸How this was calculated (27 assumptions, 9 sources)
  1. 01Your US income is reported to Canada using the Bank of Canada annual average rate.1
  2. 02No US standard deduction is applied. As a Canadian resident who commutes to work in Michigan you generally file Form 1040-NR as a non-resident alien, and non-resident aliens are generally not entitled to it. Most Michigan paycheck calculators apply it anyway, which is why their take-home numbers look higher than this one.2
  3. 03No treaty cap is applied to your US federal tax. The Canada–US treaty offers one to married commuters, computed as if the couple were American; on a single filer it has nothing to work with.3
  4. 04A pre-tax 401(k) contribution lowers your income tax but not your Social Security or Medicare tax. Health premiums through a Section 125 plan lower both.[no source recorded]
  5. 05The Additional Medicare Tax threshold is not indexed to inflation, so more people cross it every year.4
  6. 06Michigan tax is a flat 4.25% on income after personal exemptions, starting from your federal AGI.5
  7. 07Your federal AGI is taken as gross pay less pre-tax deductions. If you file Form 1040-NR rather than Form 1040, what Michigan treats as federal AGI may differ.[our modelling]
  8. 08City tax uses the non-resident rate of 1.20%, which is what you pay as someone who works in the city but lives outside it.6
  9. 09City tax is estimated on your pay after pre-tax deductions. City-level personal exemptions are not modelled, so your actual city tax may be slightly lower than shown.[our modelling]
  10. 10The federal basic personal amount is applied as a non-refundable credit at the lowest federal rate, which is how it actually works — it is not a deduction from income.7
  11. 11Your income is high enough that the federal basic personal amount is partly phased out.7
  12. 12The Ontario surtax is included. It is charged on your Ontario tax, not on your income, and many calculators leave it out entirely.8
  13. 13The Ontario Health Premium is included. It is a separate charge on top of income tax and is also commonly omitted.8
  14. 14Canada gives two separate foreign tax credits — one federal, one Ontario — and each is capped by the Canadian tax that would otherwise be payable at that level on your US income.1
  15. 15Social Security and Medicare withheld in the US is treated as creditable against your Canadian tax.1
  16. 16If your US tax exceeds the Canadian tax on the same income, the excess is not refunded — the credits simply reduce your Canadian tax to zero.1
  17. 17The Ontario Health Premium is not counted as tax otherwise payable when capping the Ontario credit, because it is a premium rather than income tax.[no source recorded]
  18. 18The Ontario credit is computed on the US tax left over after the federal credit, not on the full amount.1
  19. 19Converted at 1.3930 USD→CAD, the Bank of Canada rate as of 2026-08-12.9
  20. 20Assumes a big-five bank keeps 2.78% as spread and a low-spread transfer service keeps 0.91%. Both are sampled estimates, not quotes — adjust them if you know what your bank actually charges.[our modelling]
  21. 21The comparison uses the conservative end of the sampled range, so a real quote should be at least as good as shown here.[our modelling]
  22. 22Take-home is shown after converting at the assumed bank rate, because that is what actually reaches a Canadian account.[our modelling]
  23. 23Assumes you worked the full year at a constant salary, with employment income only.[our modelling]
  24. 24No itemized deductions, and no tax credits beyond the basic personal amounts.[our modelling]
  25. 25No alternative minimum tax and no net investment income tax.[our modelling]
  26. 26No RRSP contribution modelling, no dependants, and no child benefits.[our modelling]
  27. 27Assumes you were a resident of Ontario for the whole year — no part-year residency.[our modelling]

Sources

  1. 1Canada–US Tax Convention Article XXIV(2)(a)(ii) as amended by Article 12 of the Protocol of 17 March 1995 (C-10.7 Schedule IV); CRA Income Tax Folio S5-F2-C1 paragraph 1.8; CRA Form T2036 (2025 edition); CRA 'Federal foreign tax credit' (line 40500) — laws-lois.justice.gc.ca/eng/acts/C-10.7/page-5.html
  2. 2IRS Revenue Procedure 2025-32, published in Internal Revenue Bulletin 2025-45 (November 3, 2025), section 4.01 Tables 1 and 3, and section 4.14 — www.irs.gov/irb/2025-45_IRB
  3. 3Canada-United States Tax Convention Act, 1984, Schedule I Article XXV(4) as renumbered to XXV(3) by Schedule VI (Protocol of 21 September 2007) Article 20; interpreted by the US Treasury Department Technical Explanation of the Convention — laws-lois.justice.gc.ca/eng/acts/C-10.7/page-2.html
  4. 4IRS Topic No. 751 (Social Security and Medicare withholding rates); SSA 2026 Cost-of-Living Adjustment Fact Sheet — www.irs.gov/taxtopics/tc751
  5. 5Michigan Department of Treasury taxpayer notice, April 15 2026; Michigan Treasury 'Withholding Tax Information by Calendar Year' — www.michigan.gov/treasury/reference/taxpayer-notices/2026/04/15/425-income-tax-rate-for-individuals-and-fiduciaries-in-2026-tax-year
  6. 6City of Detroit Income Tax Division; Michigan Department of Treasury Form 5469, City of Detroit Income Tax Withholding Guide — detroitmi.gov/departments/office-chief-financial-officer/ocfo-divisions/office-treasury/income-tax/income-tax-information
  7. 7CRA 'Current year tax rates and income brackets (2026)'; CRA Guide T4127, Payroll Deductions Formulas, 122nd Edition Effective January 1 2026; CRA Guide T4032-ON, Payroll Deductions Tables, January 2026 — www.canada.ca/en/revenue-agency/services/tax/individuals/tax-rates-brackets/current-year.html
  8. 8Ontario Ministry of Finance, 'Personal Income Tax Rates and Credits' open dataset, 2026 resource (last updated 2025-12-12); Ontario Ministry of Finance 'Ontario Health Premium rates' open dataset — data.ontario.ca/dataset/personal-income-tax-rates-and-credits
  9. 9Bank of Canada daily exchange rates (series FXUSDCAD) — www.bankofcanada.ca/valet/observations/FXUSDCAD/json?recent=1

Rate table 2026@2026-08-13. A numbered line traces to the source of that number above. 2 lines are marked as having no recorded source — they are a rule this calculator applies that the rate table does not yet cite.

These are fixed inputs — a full year, no 401(k) or health-premium deductions, one Michigan exemption, and the whole US net converted. Run your own numbers to change any of them.