Form 5074 (2012)
De minimis exception. This is an exception to the general rule for
Do not use this form if you were a bona fide resident of
determining the source of income earned in Guam or the CNMI.
Guam or the CNMI during the entire tax year, or were
Generally, income from Guam or the CNMI does not include
considered a bona fide resident of Guam or the CNMI for
compensation for services performed in Guam or the CNMI if during
the entire tax year under the special rules for the year
of a move (see chapter 1 of Pub. 570, Tax Guide for Individuals With
Income From U.S. Possessions).
• Were a U.S. citizen or resident,
Joint returns. If you file jointly and only one spouse is a bona fide
• Were not a bona fide resident of Guam or the CNMI,
resident of Guam or the CNMI for the entire tax year, the resident status
• Were not employed by or under contract with an individual,
for both spouses and subsequent tax treatment is determined by the
partnership, or corporation that is engaged in a trade or business in
spouse with the higher adjusted gross income (AGI) (disregarding
Guam or the CNMI,
community property laws). File Form 5074 only if the spouse with the
• Temporarily performed services in Guam or the CNMI for 90 days or
higher AGI is not a bona fide resident of Guam or the CNMI for the entire
• Earned $3,000 or less from such services.
Where to file. If you are not enclosing a check or money order, file your
Special rules may apply to bona fide residents of U.S.
Form 1040 (including Form 5074) with the Department of the Treasury,
possessions who have gain from dispositions of certain
Internal Revenue Service Center, Austin, TX 73301-0215 USA.
investment property within the 10-year period beginning
If you are including a check or money order, file your return with the
when they became a bona fide resident. For details, see
Internal Revenue Service, P.O. Box 1303, Charlotte, NC 28201-1303
Special Rules for Gains From Dispositions of Certain Property, in
chapter 2 of Pub. 570, Regulations section 1.937-2(f)(1), and Examples 1
Additional information. Pub. 570 has more information and an example
and 2 of section 1.937-2(k).
of how to complete Form 5074. To get Pub. 570, see Quick and Easy
Part II—Adjusted Gross Income From Guam
Access to Tax Help and Tax Products in the Instructions for Form 1040.
or the CNMI Reported on Form 1040
Part I—Income From Guam or the CNMI
Lines 21 through 23. If you had Guam or CNMI source self-
Reported on Form 1040
employment income, figure the amount to enter on each line by (1)
Source of income. The rules for determining the source of income are
dividing your Guam or CNMI source self-employment income by your
explained in sections 861 through 865 and section 937, Regulations
total (worldwide) self-employment income and (2) multiplying the total
section 1.937-2, and chapter 2 of Pub. 570. Some general rules are:
amount of each deduction that applies to you by the result in (1).
• The source of wages, salaries, or tips is generally where the services
Line 24. Enter the amount of penalty on early withdrawals from savings
are performed. If you worked both in and outside Guam or the CNMI,
accounts in banks or branches of U.S. banks located in Guam or the
include on line 1 only wages, salaries, or tips earned while you were in
CNMI. The Form 1099-INT or Form 1099-OID you received will show the
Guam or the CNMI. However, certain income earned while temporarily
amount of any penalty you were charged.
performing services in Guam or the CNMI will not be considered income
Line 25. Enter the total of your and your spouse’s IRA deductions
from Guam or the CNMI. For details, see De minimis exception on this
attributable to Guam or CNMI compensation or earned income. Figure
the amount to report on line 25 by (1) dividing your Guam or CNMI
Military spouses. If you are the civilian spouse of a member of the U.
compensation or earned income by your total (worldwide) compensation
S. Armed Forces, work in Guam or the CNMI, and retain a residence or
or earned income and (2) multiplying the amount of your IRA deduction
domicile in one of the 50 states or the District of Columbia under the
by the result in (1). Figure the amount of your spouse’s IRA deduction
Military Spouses Residency Relief Act (MSRRA), your wages, salaries,
the same way.
tips, and self-employment income will not be considered income from
Line 28. Include in the total on line 28 the amount of any other
Guam or the CNMI. Under MSRRA, the military spouse must be in
deductions included on Form 1040, line 36, that are attributable to your
Guam or the CNMI solely to be with his/her servicemember spouse who
Guam or CNMI income. On the dotted line next to line 28, enter the
is serving in compliance with military orders. For details on MSRRA, see
amount of each deduction attributable to your Guam or CNMI income
and identify it as you did on Form 1040, line 36. If you or your spouse
• The source of interest income is generally where the payer is located.
had an Archer MSA deduction on Form 1040, line 36, figure the amount
For example, Guam or CNMI source income includes interest from a
to report on line 28 the same way you would an IRA deduction (see Line
certificate of deposit issued by a bank or branch of a U.S. bank in Guam
or the CNMI.
Penalty for Failure To Furnish Information
• Generally, dividends are sourced where the paying corporation is
created or organized.
If, in tax year 2001 or later, you became or ceased to be a bona fide
• Taxable refunds, credits, or offsets of local Guam or CNMI income
resident of a U.S. possession, you may be required to file Form 8898,
taxes only include nonmirror code income taxes.
Statement for Individuals Who Begin or End Bona Fide Residence in a
• Alimony received from a person who is a bona fide resident of Guam
U.S. Possession. If you fail to provide the required information, you may
or the CNMI is sourced in that specific possession.
have to pay a $1,000 penalty for each failure unless you can show the
failure was due to reasonable cause and not willful neglect. This penalty
• Except as provided in regulations, income earned after December 31,
is in addition to any criminal penalty provided by law. For details, see
2004, that is from sources within the United States or effectively
the Instructions for Form 8898.
connected with the conduct of a trade or business in the United States
is not income from Guam or the CNMI.
• The source of gains, profits, or income from the sale or disposition of
real property (and any interest in real property) is generally where the
real property is located.
Personal property. The source of income from the sale of
nondepreciable personal property is generally the seller's residence. For
example, if you are a bona fide resident of Guam or the CNMI, gain from
the sale or disposition of personal property is generally from sources
within Guam or the CNMI. Income from the sale of inventory is generally
sourced where the title to the property passes. See section 865 for