Eighteen years ago, Mr. Harv DeHaan, a U.S. citizen, moved to Vancouver with his parents. He went to high school in Vancouver and upon completion of his program he was employed in construction work in the Vancouver area. In time he became a construction supervisor. He married a Canadian five years ago. The couple subsequently purchased a home in Vancouver where they lived and raised two children. He never became a Canadian citizen.

During the year in question, the state of the construction industry in Vancouver was such that he could not be employed on a regular basis, although he did work on several jobs during the year. Effective August 1 of that year, he accepted an offer of employment with a construction company operating in the State of Washington, and during the remainder of the year, and the entire following year, he worked on construction jobs in the State of Washington and in Alaska. He rented an apartment in Seattle, Washington but maintained his home in Vancouver where his wife and children made their regular home. The household telephone listing in the Vancouver telephone directory was in his name. He visited his family when he was able to take time to go to Vancouver. He always returned to the Vancouver address when his duties permitted.

During the year in question, he worked a total of 800 hours on the new job, earning substantially more than US$10,000.

REQUIRED
Prepare a memo for the tax person in your firm who will advise Mr. DeHaan on his income tax liability for the year in question. Evaluate in detail the alternatives in the residence issue as they relate to this fact situation for the year in question. Discuss each possible degree of residence and its tax consequences. State your conclusion on the case after considering the relevant international tax agreement and appropriately weighing the significance of the facts in the case.