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If part of your self-employment income is

6) A description of the control and business

A U.S. person who becomes a resident

relationships between you and the related

of American Samoa, Guam, or the

excluded, only the part of the deduction that is

person in the possession, if that applies.

CNMI may be subject to U.S. tax on

CAUTION

based on the nonexcluded income is allowed.

U.S. source income, including gain from sales of

This would happen if, for instance, you have two

7) The status of your tax liability for the

certain U.S. assets, during the 10-year period

businesses, and only the income from one of

year(s) in question and, if it applies, the

beginning when the person becomes a resident.

them is excludable.

status of the tax liability of the related per-

The U.S. person will be subject to U.S. tax on

son in the possession.

Figure the tax on the nonexcluded income by

any gain from the disposition of U.S. property

multiplying your total self-employment tax (from

8) Whether you or the related person, if one

(including appreciated stock issued by a U.S.

Schedule SE) by the following fraction.

is involved, is entitled to any possession

corporation) during this period.

tax incentive or subsidy program benefits

for the year(s) in question.

Guam

Self-employment income that is not excluded

9) Copies of any correspondence received

Total self-employment income

Guam has its own tax system based on the

(including excluded income)

from the possession tax agency and cop-

same tax laws and tax rates that apply in the

ies of any material you provided to them.

The result is your self-employment tax on

United States.

10) Copy of the possession tax return(s) for

nonexcluded income. You can deduct one-half

Requests for advice about Guam resi-

the year(s) in question.

of this amount on line 28 of Form 1040.

dency and tax matters should be ad-

11) Whether a foreign tax credit was claimed

dressed to:

Double Taxation

on your federal tax return for all or part of

the possession tax paid or accrued on the

Department of Revenue and Taxation

A mutual agreement procedure exists to settle

item in question.

Government of Guam

issues where there is an inconsistency between

P.O. Box 23607

12) Whether your federal return or the return

the tax treatment by the IRS and the taxing

GMF, GU 96921

of the related person, if there is one, was

authorities of the following possessions.

examined, or is being examined.

The telephone number is (671)

•

American Samoa.

13) A separate document signed and dated by

472 – 7471. The fax number is (671)

•

you that you consent to the disclosure to

472 – 2643.

Guam.

the designated possession tax official of

•

If you are a U.S. citizen with income from

Puerto Rico.

any or all of the items of information set

sources in Guam and the United States, you

•

forth in, or enclosed with, the request for

The Virgin Islands.

must file your income tax return as explained

assistance under this procedure.

below with either Guam or the United States, but

These issues usually involve allocations of

not both. You are not liable for any income tax to

Credit or refund. In addition to the tax as-

income, deductions, credits, or allowances be-

the jurisdiction with which you do not have to file.

sistance request, if you seek a credit or refund of

tween related persons, determinations of resi-

If you are a resident of Guam on the last

any overpayment of United States tax paid on

dency, and determinations of the source of

day of your tax year, you should file your return

the income in question, you should file a claim

with the Department of Revenue and Taxation at

income and related expenses.

on Form 1040X, Amended U.S. Individual In-

the address above.

come Tax Return. Indicate on the form that a

Send your written request for assis-

Include income from worldwide sources on

request for assistance under the mutual agree-

tance under this procedure to:

the Guam return. Include any balance of tax due

ment procedure with the possession has been

with your tax return.

filed. Attach a copy of the request to the form.

Internal Revenue Service

Director, International

You should take whatever steps must be

Example. Gary Barker was a resident of

taken under the possession tax code to prevent

Attn: Office of Tax Treaty

Guam during the entire year. He received wages

the expiration of the statutory period for filing a

1111 Constitution Avenue, N.W.

of $20,000 paid by a private employer and divi-

claim for credit or refund of a possession tax.

Washington, DC 20224

dends of $4,000 from U.S. corporations that

carry on business mainly in the United States.

Your request must contain a statement that

He must file a 2003 income tax return with

assistance is requested under the mutual agree-

the Government of Guam. He reports his total

ment procedure with the possession. It must

Filing Requirements

income of $24,000 on the Guam return.

also contain all the facts and circumstances re-

lating to your particular case. It must be signed

for Individuals in

If you are a resident of the United

and dated. To avoid unnecessary delays, make

States on the last day of your tax year,

U.S. Possessions

sure you include all of the following information.

you should file your return with the:

1) Your name, address, and social security

Internal Revenue Service

An individual who has income from Guam, the

number.

Philadelphia, PA 19255 – 0215

CNMI, American Samoa, the Virgin Islands, or

Puerto Rico will probably have to file a tax return

2) The name, address, and social security

with the tax department of one of the posses-

Include income from worldwide sources on

number of the related person in the pos-

sions. It is possible that you may have to file two

the U.S. return. Include any balance of tax due

session (if one is involved).

annual tax returns: one with the possession’s

with your tax return.

3) The tax year(s) in question and the Inter-

tax department and the other with the U.S. Inter-

nal Revenue Service Center where your

nal Revenue Service.

If you are neither a resident of Guam nor a

return was filed.

You should ask for forms and advice about

resident of the United States at the end of your

the filing of possession tax returns from that

tax year, you should file with Guam if you are a

4) If income tax is involved, the type of in-

possession’s tax department and not the Inter-

citizen of Guam but not otherwise a citizen of the

come, a description of the transaction, ac-

nal Revenue Service. In some situations you

United States (born or naturalized in Guam). If

tivities, or other pertinent circumstances,

may have to determine if you are a resident or a

you are a U.S. citizen or resident but not other-

and the positions taken by you and the

nonresident of a certain possession. Contact the

wise a citizen or resident of Guam, you should

possession tax agency.

tax department of that possession for advice

file with the United States.

5) The amount of the item (income, deduc-

about this point.

tion, or credit) involved and the amount of

The following discussions cover the general

Example. William Berry, a U.S. citizen, was

tax the possession assessed or proposed

rules for filing returns in Guam, the CNMI, Amer-

employed by a private company in Guam from

to assess.

ican Samoa, the Virgin Islands, and Puerto Rico.

June 1 through December 31, 2003. He re-

Page 5

Publication 570 - Tax Guide For Individuals With Income From U.s. Possessions - 2003 Page 5

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