For use in preparing

Future Developments

Publication 570

Tax Guide for

Individuals

With Income

From U.S.

Territories

For use in preparing

2025 Returns

For the latest information about developments related to

Pub. 570, such as legislation enacted after it was

published, go to IRS.gov/Pub570.

What’s New

No tax on tips, no tax on overtime, no tax on car loan

interest, and the enhanced deduction for seniors. If

you are filing a U.S. income tax return, the deductions for

tips, overtime, passenger vehicle loan interest, and seniors may not be allowable, or may be reduced, depending on your modified adjusted gross income, filing status,

and the amount of your territory excluded income. See

Deductions if Territory Income Is Excluded, later. For more

information, see the Schedule 1-A instructions found in

the Instructions for Form 1040.

Trump accounts and new Form 4547. Recent legislation allows parents, guardians, and other authorized individuals to elect to establish a new type of individual retirement account, called a Trump account, for the exclusive

benefit of certain children. If the child was born after 2024

and before 2029, is a U.S. citizen, and meets certain other

requirements, the authorized individual may also elect to

receive a $1,000 pilot program contribution to the child's

Trump account. Both elections can be made with the IRS

(not a territory tax department) on Form 4547. For more

information on Trump accounts, and to learn how to make

these elections, see Form 4547 and its instructions or go

to trumpaccounts.gov.

Due date of return. File your tax return by April 15,

2026.

Standard deduction amount. For 2025, the standard

deduction amount has increased for all filers. See Standard deduction amount, later.

Maximum income subject to social security tax. For

2025, the maximum amount of self-employment income

subject to social security tax is $176,100. The amount will

increase to $184,500 for 2026.

Optional methods to figure net earnings. For 2025,

the maximum income for using the optional methods is

$7,240. This amount will increase to $7,560 for 2026.

Reminders

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Feb 26, 2026

U.S. Armed Forces in Puerto Rico and American Samoa. Active duty members of the U.S. Armed Forces

whose state of legal residence is American Samoa or Puerto Rico are U.S. Government employees. They are required to file both a U.S. income tax return and a territory

tax return, as applicable. See Active duty member of the

U.S. Armed Forces under Special Rules for American Samoa and Special Rules for Puerto Rico, later.

U.S. Government employees in American Samoa.

The reporting requirements for U.S. Government

Publication 570 (2025) Catalog Number 15118B

Department of the Treasury Internal Revenue Service www.irs.gov

employees who are not bona fide residents of American

Samoa have been clarified. See U.S. Government employees under Special Rules for American Samoa, later.

Additional child tax credit (ACTC) and bona fide residents of Puerto Rico. Bona fide residents of Puerto

Rico are no longer required to have three or more qualifying children to be eligible to claim the ACTC. Bona fide

residents of Puerto Rico may be eligible to claim the

ACTC if they have one or more qualifying children. See

Additional child tax credit (ACTC), later.

For more information about the child tax credit

(CTC). For more information, see the Instructions for

Form 1040-SS. If you are required to file Form 1040, see

the Instructions for Form 1040 for more information about

the CTC.

Filing status name changed to qualifying surviving

spouse. The filing status qualifying widow(er) is now

called qualifying surviving spouse. The rules for the filing

status have not changed. The same rules that applied for

qualifying widow(er) apply to qualifying surviving spouse.

Digital assets. You will need to answer the question on

page 1 of Form 1040-SS about whether you engaged in a

transaction involving digital assets in 2025. Don’t leave

this field blank. The question must be answered by all taxpayers, not just taxpayers who engaged in a transaction

involving digital assets.

The COVID-19 related credit for qualified sick and

family leave wages is limited to leave taken after

March 31, 2020, and before October 1, 2021, and may

no longer be claimed on Schedule H (Form 1040).

The time periods for providing the leave for the credits for

qualified sick and family leave wages, as enacted under

the Families First Coronavirus Response Act (FFCRA)

and amended and extended by the COVID-related Tax

Relief Act of 2020, for leave taken after March 31, 2020,

and before April 1, 2021, and the credit for qualified sick

and family leave wages under sections 3131, 3132, and

3133 of the Internal Revenue Code, as enacted under the

American Rescue Plan Act of 2021 (the ARP), for leave

taken after March 31, 2021, and before October 1, 2021,

have expired. Effective for tax periods beginning after

2023, the lines used to claim the credit for qualified sick

and family leave wages have been removed from Schedule H (Form 1040) because it would be extremely rare for

an employer to pay wages in 2024 for qualified sick and

family leave taken after March 31, 2020, and before October 1, 2021.

Disaster tax relief. To find information on the most recent tax relief provisions for taxpayers affected by disaster

situations, see IRS.gov/Disaster. See Pub. 547, Casualties, Disasters, and Thefts, for discussions on the special

rules that apply to federally declared disaster areas.

Automatic 60-day extension. Certain taxpayers affected by federally declared disasters may be eligible for an

automatic 60-day extension for filing returns, paying taxes,

and performing other tasks required by the IRS. For more

information, see Pub. 547.

Qualified opportunity zones (QOZs). The Tax Cuts and

Jobs Act (TCJA) amended the Internal Revenue Code to

2

encourage investments in designated economically distressed communities by providing income tax benefits to

taxpayers who invest new capital in businesses located

within QOZs. There are QOZs located in the 50 states, the

District of Columbia, American Samoa, the CNMI, Guam,

Puerto Rico, and the USVI.

Bona fide residents of the CNMI, Guam, and the USVI

will generally report qualifying investments on the income

tax return they file with their territory tax agency, while residents of American Samoa and Puerto Rico will report

qualifying investments on their U.S. income tax return. For

additional information, see the QOZ FAQs at IRS.gov/

Newsroom/Opportunity-Zones-Frequently-AskedQuestions. Taxpayers should also consult with their territory tax agency for additional information.

Taxpayer Advocate Service (TAS). TAS is an independent organization within the IRS that helps taxpayers and

protects taxpayer rights. The phone numbers for the local

advocate for the territories are:

• American Samoa, the CNMI, and Guam:

808-466-6375 (in Hawaii);

• Puerto Rico and the USVI: 787-522-8600 for Spanish,

and 787-522-8601 for English (in Puerto Rico).

For more information, see chapter 5.

Self-employment tax. Bona fide residents of a U.S. territory who have self-employment income must generally

pay self-employment tax to the United States. Self-employment tax includes both social security and Medicare.

Bona fide residents may be subject to U.S. self-employment tax even if they have no income tax filing obligation

with the United States. See Self-Employment Tax in chapter 4 for more information.

Additional Medicare Tax. You may be required to pay

Additional Medicare Tax. Also, you may need to report Additional Medicare Tax withheld by your employer. For more

information, see Additional Medicare Tax under Special

Rules for Completing Your U.S. Tax Return in chapter 4.

Net Investment Income Tax (NIIT). The NIIT imposes a

3.8% tax on the lesser of an individual’s net investment income or the excess of the individual’s modified adjusted

gross income over a specified threshold amount. Bona

fide residents of Puerto Rico and American Samoa who

have a federal income tax return filing obligation may be liable for the NIIT if the taxpayer’s modified adjusted gross

income from non-territory sources exceeds a specified

threshold amount. Also, bona fide residents must take into

account any additional tax liability associated with the NIIT

when calculating their estimated tax payments.

The NIIT does not apply to any individual who is a nonresident alien with respect to the United States. For more

information, see Net Investment Income Tax under Bona

Fide Resident of American Samoa and Bona Fide Resident of Puerto Rico in chapter 3.

Because bona fide residents of the CNMI, Guam, and

the U.S. Virgin Islands generally do not have a federal income tax return filing obligation, the NIIT generally does

not directly apply to them. These residents should contact

their local territorial tax department for guidance on the

Publication 570 (2025)

possible mirrored application of the NIIT in these jurisdictions.

Individual taxpayer identification numbers (ITINs) for

aliens. If you are a nonresident or resident alien and you

do not have and are not eligible to get a social security

number (SSN), you must apply for an ITIN. For details on

how to do so, see Form W-7 and the Instructions for Form

W-7. Allow 7 weeks for the IRS to notify you of your ITIN

application status (9 to 11 weeks if submitted during peak

processing periods (January 15 through April 30) or if you

are filing from overseas). If you already have an ITIN, enter

it wherever your SSN is requested on your tax return.

For more information, go to IRS.gov/ITIN.

Caution: An ITIN is for tax use only. It does not entitle

you to social security benefits or change your employment

or immigration status under U.S. law.

Expired ITIN. If your ITIN wasn’t included on at least one

federal tax return for the last 3 consecutive tax years, it will

expire on December 31 of the third consecutive year and

must be renewed before being used again on a federal tax

return. Affected taxpayers who expect to file a tax return in

2026 must submit a renewal application. For more information on how to renew an ITIN, go to IRS.gov/ITIN.

Electronic filing. You can e-file Form 1040-SS. For general information about electronic filing, visit IRS.gov/Efile.

Earned income credit (EIC). Generally, if you are a

bona fide resident of a U.S. territory, you cannot claim the

EIC on your U.S. tax return. However, certain U.S. territories may allow bona fide residents to claim the EIC on

their territory tax return.

To claim the EIC on your U.S. tax return, your home

(and your spouse’s if filing a joint return) must have been

in the United States for more than half the year. If you have

a child, the child must have lived with you in the United

States for more than half the year. For this purpose, the

United States includes only the 50 states and the District

of Columbia. Special rules apply to military personnel stationed outside the United States. For more information on

this credit, see Pub. 596, Earned Income Credit.

Tip: If you claim the earned income tax credit (EITC)

on your tax return, the IRS must hold your refund until at

least mid-February—including the portion not associated

with the EITC. To track your refund, go to IRS.gov/

Refunds, or download the IRS2Go mobile app.

Form 8938, Statement of Specified Foreign Financial

Assets. If you have specified foreign financial assets in

foreign jurisdictions valued above certain threshold dollar

amounts, you may have to file Form 8938 when you file

your U.S. income tax return with the IRS.

Even if you are required to file Form 8938, you may not

have to report certain specified foreign financial assets on

Form 8938. See Bona Fide Resident of a U.S. Possession

in the Instructions for Form 8938 for more details.

Tip: Because bona fide residents of the CNMI, Guam,

and the USVI generally do not have a U.S. federal income

tax return filing obligation, they generally are not required

to file Form 8938 with the IRS. These residents should

Publication 570 (2025)

contact their local territorial tax department for guidance

on the possible mirrored application of this reporting requirement with these jurisdictions.

Change of address. If you change your mailing address,

use Form 8822 to notify the IRS and U.S. territory tax administration, if appropriate. Mail Form 8822 to the IRS

Service Center or U.S. territory tax administration address

designated for your old address (see page 2 of Form

8822).

If you change your address before filing your tax return,

write the new address in the appropriate boxes of your tax

return when you file.

Reporting a change of bona fide residence. If you became or cease to be a bona fide resident of a U.S. territory, you may need to file Form 8898, Statement for Individuals Who Begin or End Bona Fide Residence in a U.S.

Territory. For additional information, see Reporting a

Change in Bona Fide Residence in chapter 1.

Photographs of missing children. The IRS is a proud

partner with the National Center for Missing & Exploited

Children® (NCMEC). Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. You can help bring

these children home by looking at the photographs and

calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child.

Introduction

This publication discusses how to treat income received

from the following U.S. territories on your tax return(s).

• American Samoa.

• The Commonwealth of Puerto Rico (Puerto Rico).

• The Commonwealth of the Northern Mariana Islands

(CNMI).

• Guam.

• The U.S. Virgin Islands (USVI).

Chapter 1 discusses the requirements for being considered a bona fide resident of the listed territories.

Chapter 2 gives the rules for determining if your income

is from sources within, or effectively connected with a

trade or business in, those territories.

Next, chapter 3 looks at the rules for filing tax returns

when you receive income from any of these territories. You

may have to file a U.S. tax return only, a territory tax return

only, or both returns. Generally, this depends on whether

you are a bona fide resident of the territory. In some cases, you may have to file a U.S. return, but will be able to

exclude income earned in a territory from U.S. tax.

If you are not a bona fide resident of one of the territories listed earlier, or are otherwise required to file a U.S. income tax return, the information in chapter 4 will tell you

how to file your U.S. tax return. This information also applies if you have income from U.S. insular areas other than

the five territories listed earlier because that income will

not qualify for any of the exclusions or other benefits

3

discussed in chapter 3. These other U.S. insular areas include:

• Baker Island,

• Howland Island,

• Jarvis Island,

• Johnston Island,

• Kingman Reef,

• Midway Islands,

• Palmyra Atoll, and

• Wake Island.

Useful Items

You may want to see:

Publication

3 Armed Forces’ Tax Guide

3

54 Tax Guide for U.S. Citizens and Resident Aliens

Abroad

54

514 Foreign Tax Credit for Individuals

514

519 U.S. Tax Guide for Aliens

519

Form (and Instructions)

1040-SS U.S. Self-Employment Tax Return

(Including the Additional Child Tax Credit for

Bona Fide Residents of Puerto Rico)

Information for individuals living or working in U.S. territories is available at IRS.gov/Individuals/InternationalTaxpayers/Individuals-Living-or-Working-in-a-US-Territory.

If you need information on U.S. taxation, write to:

1040-SS

1116 Foreign Tax Credit

1116

4563 Exclusion of Income for Bona Fide Residents

of American Samoa

Internal Revenue Service

International Section

Philadelphia, PA 19255-0725

4563

4868 Application for Automatic Extension of Time To

File U.S. Individual Income Tax Return

4868

If you need additional information on your tax obligations in a U.S. territory, write to the tax department of that

territory. Their addresses are provided in chapter 3 under

the individual headings for each territory.

5074 Allocation of Individual Income Tax to Guam or

the Commonwealth of the Northern Mariana

Islands (CNMI)

5074

8938 Statement of Specified Foreign Financial

Assets

8938

Comments and suggestions. We welcome your comments about this publication and suggestions for future

editions.

You can send us comments through IRS.gov/

FormComments. Or, you can write to the Internal Revenue

Service, Tax Forms and Publications, 1111 Constitution

Ave. NW, IR-6526, Washington, DC 20224.

Although we can’t respond individually to each comment received, we do appreciate your feedback and will

consider your comments and suggestions as we revise

our tax forms, instructions, and publications. Don’t send

tax questions, tax returns, or payments to the above address.

Getting answers to your tax questions. If you have

a tax question not answered by this publication or the How

To Get Tax Help section at the end of this publication, go

to the IRS Interactive Tax Assistant page at IRS.gov/

Help/ITA where you can find topics by using the search

feature or viewing the categories listed.

Getting tax forms, instructions, and publications.

Go to IRS.gov/Forms to download current and prior-year

forms, instructions, and publications.

Ordering tax forms, instructions, and publications.

Go to IRS.gov/OrderForms to order current forms, instructions, and publications; call 800-829-3676 to order

prior-year forms and instructions. The IRS will process

your order for forms and publications as soon as possible.

Don’t resubmit requests you’ve already sent us. You can

get forms and publications faster online.

To obtain tax forms required for your territory tax return,

contact the tax office in your territory. See chapter 3 for

more information.

4

Chapter 1

8689 Allocation of Individual Income Tax to the U.S.

Virgin Islands

8689

8898 Statement for Individuals Who Begin or End

Bona Fide Residence in a U.S. Territory

8898

8959 Additional Medicare Tax

8959

8960 Net Investment Income Tax—Individuals,

Estates, and Trusts

8960

1.

Bona Fide Residence

In order to qualify for certain tax benefits (see chapter 3),

you must be a bona fide resident of American Samoa, the

CNMI, Guam, Puerto Rico, or the USVI for the tax year.

Generally, you are a bona fide resident of one of these territories (the relevant territory) if, during the tax year, you:

• Meet the presence test,

• Do not have a tax home outside the relevant territory,

and

• Do not have a closer connection to the United States

or to a foreign country than to the relevant territory.

Special rule for members of the U.S. Armed Forces. If

you are a member of the U.S. Armed Forces who qualified

Bona Fide Residence

Publication 570 (2025)

as a bona fide resident of the relevant territory in an earlier

tax year, your absence from that territory during the current tax year in compliance with military orders will not affect your status as a bona fide resident. Likewise, being in

a territory solely in compliance with military orders will not

qualify you for bona fide residency. Also see the special

income source rule for members of the U.S. Armed Forces

in chapter 2, under Compensation for Labor or Personal

Services.

Special rule for civilian spouse of active duty member of the U.S. Armed Forces. If you are the civilian

spouse of an active duty service member, under the Military Spouses Residency Relief Act (MSRRA) you can

choose to keep your prior residence or domicile for tax

purposes (tax residence) when accompanying the service

member spouse who is relocating under military orders to

a new military duty station in one of the 50 states, the District of Columbia, or a U.S. territory. Before relocating, you

and your spouse must have the same tax residence.

If you are a civilian spouse and choose to keep your

prior tax residence after such relocation, the source of income for services performed (for example, wages, salaries, tips, or self-employment) by you is considered to be

(the jurisdiction of) the prior tax residence. As a result, the

amount of income tax withholding (from Form(s) W-2) that

you are able to claim on your federal return, as well as the

need to file a state or U.S. territory return, may be affected.

Tip: The spouse of the service member may elect to

use the same residence for tax purposes as the service

member regardless of the date on which the marriage of

the spouse and service member occurred.

For more information, see the following.

must be present in the relevant territory for at least 60

days.

3. You were present in the United States for no more

than 90 days during the tax year.

4. You had earned income in the United States of no

more than a total of $3,000 and were present for more

days in the relevant territory than in the United States

during the tax year. Earned income is pay for personal

services performed, such as wages, salaries, or professional fees.

5. You had no significant connection to the United States

during the tax year.

Special rule for nonresident aliens. Conditions (1)

through (5) above do not apply to nonresident aliens of the

United States. Instead, nonresident aliens must meet the

substantial presence test discussed in chapter 1 of Pub.

519. In that discussion, substitute the name of the territory

for “United States” and “U.S.” wherever they appear. Disregard the discussion in that chapter about a Closer Connection to a Foreign Country.

Days of Presence in the United States

or Relevant Territory

Generally, you are treated as being present in the United

States or in the relevant territory on any day that you are

physically present in that location at any time during the

day.

Days of presence in a territory. You are considered to

be present in the relevant territory on any of the following

days.

• Notice 2010-30, available at IRS.gov/irb/

1. Any day you are physically present in that territory at

any time during the day.

• Notice 2011-16, available at IRS.gov/irb/

2. Any day you are outside of the relevant territory in order to receive, or to accompany any of the following

family members to receive, qualifying medical treatment (see Qualifying Medical Treatment, later).

2010-18_IRB#NOT-2010-30.

2011-17_IRB#NOT-2011-16.

• Notice 2012-41, available at IRS.gov/irb/

2012-26_IRB#NOT-2012-41.

Also, you can consult with state, local, or U.S. territory

tax authorities regarding your tax obligations under

MSRRA.

Presence Test

If you are a U.S. citizen or resident alien, you will satisfy

the presence test for the tax year if you meet one of the

following conditions.

1. You were present in the relevant territory for at least

183 days during the tax year.

2. You were present in the relevant territory for at least

549 days during the 3-year period that includes the

current tax year and the 2 immediately preceding tax

years. During each year of the 3-year period, you

Publication 570 (2025)

Chapter 1

a. Your parent.

b. Your spouse.

c. Your child or stepchild. This includes an adopted

child or child lawfully placed with you for legal

adoption. This also includes a foster child who is

placed with you by an authorized placement

agency or by judgment, decree, or other order of

any court of competent jurisdiction.

3. Any day you are outside the relevant territory because

you leave or are unable to return to the relevant territory during any:

a. 14-day period within which a major disaster occurs in the relevant territory for which a Federal

Emergency Management Agency (FEMA) notice

of a federal declaration of a major disaster is issued in the Federal Register, or

Bona Fide Residence

5

b. Period for which a mandatory evacuation order is

in effect for the geographic area in the relevant territory in which your main home is located.

4. Any day (up to a total of 30 days) that you are outside

the relevant territory and the United States for business or personal travel, but this rule:

a. Applies only if the number of days you are considered present in the relevant territory exceeds the

number of days you are considered present in the

United States (determined without regard to the

rule in this section (4)), and

b. Does not apply for purposes of calculating the

minimum 60 days of presence in the relevant territory that is required for the 549-day presence test

(see Presence Test, earlier).

If, during a single day, you are physically present:

Qualifying Medical Treatment

Such treatment is generally provided by (or under the supervision of) a physician for an illness, injury, impairment,

or physical or mental condition. The treatment generally

involves:

• Any period of inpatient care that requires an overnight

stay in a hospital or hospice, and any period immediately before or after that inpatient care to the extent it

is medically necessary; or

• In the United States and in the relevant territory, that

• Any temporary period of inpatient care in a residential

• In two territories, that day is considered a day of pres-

With respect to each qualifying medical treatment, you

must prepare (or obtain) and maintain documentation supporting your claim that such treatment meets the criteria to

be considered days of presence in the relevant territory.

You must be able to produce this documentation within 30

days if requested by the IRS or tax administrator for the

relevant territory.

medical care facility for medically necessary rehabilitation services.

day is considered a day of presence in the relevant

territory; or

ence in the territory where your tax home is located

(see Tax Home, later).

Days of presence in the United States. You are considered to be present in the United States on any day that

you are physically present in the United States at any time

during the day. However, do not count the following days

as days of presence in the United States.

1. Any day you are temporarily present in the United

States in order to receive, or to accompany a parent,

spouse, or child who is receiving, qualifying medical

treatment. Child is defined in item 2c under Days of

presence in a territory, earlier. Qualifying medical

treatment is defined later.

2. Any day you are temporarily present in the United

States because you leave or are unable to return to

the relevant territory during any:

b. Period for which a mandatory evacuation order is

in effect for the geographic area in the relevant territory in which your main home is located.

3. Any day you are in the United States for less than 24

hours when you are traveling between two places outside the United States.

4. Any day you are temporarily present in the United

States as a professional athlete to compete in a charitable sports event (defined later).

5. Any day you are temporarily in the United States as a

student (defined later).

Chapter 1

You must keep the following documentation.

1. Records that provide:

a. The patient’s name and relationship to you (if the

medical treatment is provided to a person you accompany);

b. The name and address of the hospital, hospice, or

residential medical care facility where the medical

treatment was provided;

c. The name, address, and telephone number of the

physician who provided the medical treatment;

a. 14-day period within which a major disaster occurs in the relevant territory for which a Federal

Emergency Management Agency (FEMA) notice

of a federal declaration of a major disaster is issued in the Federal Register, or

6

6. Any day you are in the United States serving as an

elected representative of the relevant territory, or serving full time as an elected or appointed official or employee of the government of that territory (or any of its

political subdivisions).

d. The date(s) on which the medical treatment was

provided; and

e. Receipt(s) of payment for the medical treatment.

2. Signed certification by the providing or supervising

physician that the medical treatment met the requirements for being qualified medical treatment, and setting forth:

a. The patient’s name,

b. A reasonably detailed description of the medical

treatment provided by (or under the supervision

of) the physician,

c. The dates on which the medical treatment was

provided, and

d. The medical facts that support the physician’s certification and determination that the treatment was

medically necessary.

Bona Fide Residence

Publication 570 (2025)

Charitable Sports Event

A charitable sports event is one that meets all of the following conditions.

• The main purpose is to benefit a qualified charitable

b. A child who is in the United States as a student.

For the purpose of determining if you have a significant

connection to the United States, the term “spouse” does

not include a spouse from whom you are legally separated

under a decree of divorce or separate maintenance.

organization.

• The entire net proceeds go to charity.

• Volunteers perform substantially all the work.

In figuring the days of presence in the United States,

you can exclude only the days on which you actually competed in the charitable sports event. You cannot exclude

the days on which you were in the United States to practice for the event, to perform promotional or other activities

related to the event, or to travel between events.

Student

To qualify as a student, you must be, during some part of

each of any 5 calendar months during the calendar year:

1. A full-time student at a school that has a regular

teaching staff, course of study, and regularly enrolled

body of students in attendance; or

2. A student taking a full-time, on-farm training course

given by a school described in (1) above or by a state,

county, or local government agency.

The 5 calendar months do not have to be consecutive.

Full-time student. A full-time student is a person who is

enrolled for the number of hours or courses the school

considers to be full-time attendance. However, school attendance exclusively at night is not considered full-time attendance.

School. The term “school” includes elementary schools,

middle schools, junior and senior high schools, colleges,

universities, and technical, trade, and mechanical schools.

It does not include on-the-job training courses, correspondence schools, and schools offering courses only

through the Internet.

Permanent home. A permanent home generally includes

an accommodation such as a house, an apartment, or a

furnished room that is either owned or rented by you or

your spouse. The dwelling unit must be available at all

times, continuously, not only for short stays.

Exception for rental property. If you or your spouse

own the dwelling unit and at any time during the tax year it

is rented to someone else at fair rental value, it will be considered your permanent home only if you or your spouse

use that property for personal purposes for more than the

greater of:

• 14 days, or

• 10% of the number of days during that tax year that

the property is rented to others at a fair rental value.

You are treated as using rental property for personal

purposes on any day the property is not being rented to

someone else at fair rental value for the entire day.

A day of personal use of a dwelling unit is also any day

that the unit is used by any of the following persons.

• You or any other person who has an interest in it, unless you rent it to another owner as their main home

under a shared equity financing agreement.

• A member of your family or a member of the family of

any other person who has an interest in it, unless the

family member uses the dwelling unit as their main

home and pays a fair rental price. Family includes only

siblings, half-siblings, spouses, ancestors (parents,

grandparents, etc.), and lineal descendants (children,

grandchildren, etc.).

• Anyone under an arrangement that lets you use some

other dwelling unit.

Significant Connection

One way in which you can meet the presence test is to

have no significant connection to the United States during

the tax year. This section looks at the factors that determine if a significant connection exists.

You are treated as having a significant connection to

the United States if you:

1. Have a permanent home in the United States;

2. Are currently registered to vote in any political subdivision of the United States; or

3. Have a spouse or child (see item 2c under Days of

presence in a territory, earlier) who is under age 18

whose main home is in the United States, other than:

Publication 570 (2025)

a. A child who is in the United States because they

are the child of divorced or legally separated parents and they are living with a custodial parent

under a custodial decree or multiple support

agreement, or

Chapter 1

• Anyone at less than a fair rental price.

However, any day you spend working substantially full

time repairing and maintaining (not improving) your property is not counted as a day of personal use. Whether your

property is used mainly for this purpose is determined in

light of all the facts and circumstances, such as:

• The amount of time you devote to repair and maintenance work,

• How often during the tax year you perform repair and

maintenance work on this property, and

• The presence and activities of companions.

Bona Fide Residence

7

See Pub. 527, Residential Rental Property (Including

Rental of Vacation Homes), for more information about

personal use of a dwelling unit.

Example—no significant U.S. connection. You, a

U.S. citizen, are a sales representative for a company

based in Guam. You live with your spouse and young children in your house in Guam, where you are also registered to vote. Your business travel requires you to spend

120 days in the United States and another 120 days in foreign countries. When traveling on business, you generally

stay at hotels but sometimes stay with your brother, who

lives in the United States. Your stays are always of short

duration and you ask your brother’s permission to stay

with him. Your brother’s house is not your permanent

home, nor do you have any other accommodations in the

United States that would be considered your permanent

home. You satisfy the presence test because you have no

significant connection to the United States.

Example—significant U.S. connection but presence test met. Pat and Carter Brown live for part of the

year in a condominium, which they own, in the CNMI.

They also own a house in Maine where they live for 120

days every year to be near their grown children and grandchildren. The Browns are retired and their only income is

from pension payments, dividends, interest, and social security benefits.

In 2025, Pat and Carter spent only 160 days in the

CNMI because of an 85-day vacation to Europe and Asia

and 120 days in the United States. Although the Browns

were present in the United States for more than 90 days

and had a significant connection to the United States because of their permanent home there, they satisfied the

presence test with respect to the CNMI because they had

no earned income in the United States and were considered physically present in the CNMI for at least 183 days

(160 days plus 30 days deemed present during their

85-day vacation to Europe and Asia for a total of 190

days).

Tax Home

You will have met the tax home test if you did not have a

tax home outside the relevant territory during any part of

the tax year. Your tax home is generally determined under

the principles of section 911(d)(3) and section 162(a)(2)

(relating to traveling expenses while away from home).

Your tax home is your regular or main place of business, employment, or post of duty regardless of where

you maintain your family home. If you do not have a regular or main place of business because of the nature of

your work, then your tax home is the place where you regularly live. If you do not fit either of these categories, you

are considered an itinerant and your tax home is wherever

you work.

Exceptions

There are some special rules regarding tax home that provide exceptions to the general rule stated above.

Students and Government Officials

Disregard the following days when determining whether

you have a tax home outside the relevant territory.

• Days you were temporarily in the United States as a

student (see Student under Days of Presence in the

United States or Relevant Territory, earlier).

• Days you were in the United States serving as an

elected representative of the relevant territory, or serving full time as an elected or appointed official or employee of the government of that territory (or any of its

political subdivisions).

Seafarers

You will not be considered to have a tax home outside the

relevant territory solely because you are employed on a

ship or other seafaring vessel that is predominantly used

in local and international waters. For this purpose, a vessel is considered to be predominantly used in local and international waters if, during the tax year, the total amount

of time it is used in international waters and in the waters

within 3 miles of the relevant territory exceeds the total

amount of time it is used in the territorial waters of the United States, another territory, or any foreign country.

Example. In 2025, you, a U.S. citizen, were employed

by a fishery and spent 250 days at sea on a fishing vessel.

When not at sea, you lived with your spouse at a house

you own in American Samoa. The fishing vessel on which

you work departs and arrives at various ports in American

Samoa, other territories, and foreign countries, but was in

international or American Samoa’s local waters for 225

days. For purposes of determining bona fide residency of

American Samoa, you will not be considered to have a tax

home outside that territory solely because of your employment on board the fishing vessel.

Year of Move

If you are moving to or from a territory during the year, you

may still be able to meet the tax home test for that year.

See Special Rules in the Year of a Move, later, in this

chapter.

Closer Connection

You will have met the closer connection test if, during any

part of the tax year, you do not have a closer connection to

the United States or a foreign country than to the relevant

U.S. territory.

You will be considered to have a closer connection to a

territory than to the United States or to a foreign country if

you have maintained more significant contacts with the

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Bona Fide Residence

Publication 570 (2025)

territories than with the United States or foreign country. In

determining if you have maintained more significant contacts with the relevant territory, the facts and circumstances to be considered include, but are not limited to, the following.

• The location of your permanent home.

• The location of your family.

• The location of personal belongings, such as automobiles, furniture, clothing, and jewelry owned by you

and your family.

• The location of social, political, cultural, professional,

or religious organizations with which you have a current relationship.

• The location where you conduct your routine personal

banking activities.

• The location where you conduct business activities

(other than those that go into determining your tax

home).

• The location of the jurisdiction in which you hold a

driver’s license.

• The location of the jurisdiction in which you vote.

• The location of charitable organizations to which you

contribute.

• The country of residence you designate on forms and

documents.

• The types of official forms and documents you file,

such as Form W-8BEN or Form W-9.

Your connections to the relevant territory will be compared to the total of your connections with the United

States and foreign countries. Your answers to the questions on Form 8898, Part III, will help establish the jurisdiction to which you have a closer connection.

Example—closer connection to the United States.

You, a U.S. citizen, moved to Puerto Rico in 2025 to start

an investment consulting and venture capital business.

Your spouse and two teenage children remained in California to allow the children to complete high school. You

traveled back to the United States regularly to see your

spouse and children, to engage in business activities, and

to take vacations. You had an apartment available for your

full-time use in Puerto Rico, but remained a joint owner of

the residence in California where your spouse and children lived. You and your family had automobiles and personal belongings such as furniture, clothing, and jewelry

located at both residences. Although you were a member

of the Puerto Rico Chamber of Commerce, you also belonged to and had current relationships with social, political, cultural, and religious organizations in California. You

received mail in California, including bank and brokerage

statements and credit card bills. You conducted your personal banking activities in California. You held a California

driver’s license and were also registered to vote there.

Based on all of the particular facts and circumstances pertaining to you, you were not a bona fide resident of Puerto

Rico in 2025 because you had a closer connection to the

United States than to Puerto Rico.

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Chapter 1

Closer connection to another territory. Generally, territories are not treated as foreign countries. Therefore, a

closer connection to a territory other than the relevant territory will not be treated as a closer connection to a foreign

country.

Example—tax home and closer connection to territory. You, a U.S. citizen, are a permanent employee of a

hotel in Guam, but work only during the tourist season. For

the remainder of each year, you live with your spouse and

children in the CNMI, where you have no outside employment. Most of your personal belongings, including your

automobile, are located in the CNMI. You are registered to

vote in, and have a driver’s license issued by, the CNMI.

You do your personal banking in the CNMI and routinely

list your CNMI address as your permanent address on

forms and documents. You satisfy the presence test with

respect to both Guam and the CNMI. You satisfy the tax

home test with respect to Guam, because your regular

place of business is in Guam. You satisfy the closer connection test with respect to both Guam and the CNMI because you do not have a closer connection to the United

States or to any foreign country. You are considered a

bona fide resident of Guam, the location of your tax home.

Exception for Year of Move

If you are moving to or from a territory during the year, you

may still be able to meet the closer connection test for that

year. See Special Rules in the Year of a Move next.

Special Rules in the Year of a

Move

If you are moving to or from a territory during the year, you

may still be able to meet the tax home and closer connection tests for that year.

Year of Moving to a Territory

You will satisfy the tax home and closer connection tests

in the tax year of changing your residence to the relevant

territory if you meet all of the following.

• You have not been a bona fide resident of the relevant

territory in any of the 3 tax years immediately preceding your move.

• In the year of the move, you do not have a tax home

outside the relevant territory or a closer connection to

the United States or a foreign country than to the relevant territory during any of the last 183 days of the tax

year.

• You are a bona fide resident of the relevant territory for

each of the 3 tax years immediately following the tax

year of your move.

Example. You, a U.S. citizen, file returns on a calendar

year basis. You lived in the United States from January

2019 through May 2025. In June 2025, you moved to the

Bona Fide Residence

9

USVI, purchased a house, and accepted a permanent job

with a local employer. From July 1 through December 31,

2025 (more than 183 days), your principal place of business was in the USVI and, during that time, you did not

have a closer connection to the United States or a foreign

country than to the USVI.

If you are a bona fide resident of the USVI during all of

2026 through 2028, you will satisfy the tax home and

closer connection tests for 2025. If you also satisfy the

presence test in 2025, you will be considered a bona fide

resident of the USVI for the 2025 tax year.

Year of Moving From a Territory

In the year you cease to be a bona fide resident of American Samoa, the CNMI, Guam, or the USVI, you will satisfy

the tax home and closer connection tests with respect to

the relevant territory if you meet all of the following.

• You have been a bona fide resident of the relevant territory for each of the 3 tax years immediately preceding your change of residence.

• In the year of the move, you do not have a tax home

outside the relevant territory or a closer connection to

the United States or a foreign country than to the relevant territory during any of the first 183 days of the tax

year.

• You are not a bona fide resident of the relevant territory for any of the 3 tax years immediately following

the tax year of your move.

Example. You, a U.S. citizen, file returns on a calendar

year basis. From January 2022 through December 2024,

you were a bona fide resident of American Samoa. You

continued to live there until September 6, 2025, when you

accepted new employment and moved to Hawaii. Your

principal place of business from January 1 through September 5, 2025 (more than 183 days), was in American

Samoa, and during that period you did not have a closer

connection to the United States or a foreign country than

to American Samoa. If you continue to live and work in

Hawaii for the rest of 2025 and throughout years 2026

through 2028, you will satisfy the tax home and closer

connection tests for 2025 with respect to American Samoa. If you also satisfy the presence test in 2025, you will

be considered a bona fide resident for the 2025 tax year.

Puerto Rico

You will be considered a bona fide resident of Puerto Rico

for the part of the tax year preceding the date on which

you move if you:

• Are a U.S. citizen,

• Are a bona fide resident of Puerto Rico for at least 2

tax years immediately preceding the tax year of the

move,

• Cease to be a bona fide resident of Puerto Rico during

the tax year,

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Chapter 1

• Cease to have a tax home in Puerto Rico during the

tax year, and

• Have a closer connection to Puerto Rico than to the

United States or a foreign country throughout the part

of the tax year preceding the date on which you cease

to have a tax home in Puerto Rico.

Example. You, a U.S. citizen, file returns on a calendar

year basis. For all of 2023 and 2024, you were a bona fide

resident of Puerto Rico. From January through May 4,

2025, you continued to reside and maintain your principal

place of business in and closer connection to Puerto Rico.

On May 5, 2025, you moved and changed your tax home

to Nevada. Later that year, you established a closer connection to the United States than to Puerto Rico. You did

not satisfy the presence test for 2025 with respect to Puerto Rico, nor the tax home or closer connection tests.

However, because you were a bona fide resident of Puerto

Rico for at least 2 tax years before you moved to Nevada

in 2025, you were a bona fide resident of Puerto Rico from

January 1 through May 4, 2025.

Reporting a Change in Bona

Fide Residence

If you became or ceased to be a bona fide resident of a

U.S. territory, you may need to file Form 8898. This applies

to the U.S. territories of American Samoa, the CNMI,

Guam, Puerto Rico, and the USVI.

Who Must File

You must file Form 8898 for the tax year in which you meet

both of the following conditions.

1. Your worldwide gross income (defined below) in that

tax year is more than $75,000.

2. You meet one of the following.

a. You take a position for U.S. tax purposes that you

became a bona fide resident of a U.S. territory after a tax year for which you filed a U.S. income tax

return as a citizen or resident alien of the United

States but not as a bona fide resident of the territory.

b. You are a citizen or resident alien of the United

States who takes the position for U.S. tax purposes that you ceased to be a bona fide resident of a

U.S. territory after a tax year for which you filed an

income tax return (with the IRS, the territory tax

authority, or both) as a bona fide resident of the

territory.

c. You take the position for U.S. tax purposes that

you became a bona fide resident of Puerto Rico or

American Samoa after a tax year for which you

were required to file an income tax return as a

bona fide resident of the CNMI, Guam, or the

USVI.

Bona Fide Residence

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Worldwide gross income. Worldwide gross income

means all income you received in the form of money,

goods, property, and services, including any income from

sources outside the United States (even if you can exclude part or all of it) and before any deductions, credits,

or rebates.

Example. You are a U.S. citizen who moved to the

CNMI in December 2024, but did not become a bona fide

resident of that territory until the 2025 tax year. You must

file Form 8898 for the 2025 tax year if your worldwide

gross income for that year was more than $75,000.

Penalty for Not Filing Form 8898

If you are required to file Form 8898 for any tax year and

you fail to file it, you may owe a penalty of $1,000. Also,

you may owe this penalty if you do not include all the information required by the form or the form includes incorrect

information. In either case, you will not owe this penalty if

you can show that such failure is due to reasonable cause

and not willful neglect. This is in addition to any criminal

penalty that may be imposed.

This chapter discusses the rules for determining if the

source of your income is from:

• American Samoa,

• The Commonwealth of the Northern Mariana Islands,

• The Commonwealth of Puerto Rico (Puerto Rico),

• Guam, or

• The U.S. Virgin Islands.

Generally, the same rules that apply for determining U.S.

source income also apply for determining territory source

income. However, there are some important exceptions to

these rules. Both the general rules and the exceptions are

discussed in this chapter.

U.S. income rule. This rule states that income is not territory source income if, under the rules of Internal Revenue

Code sections 861–865, it is treated as income:

• From sources within the United States, or

• Effectively connected with the conduct of a trade or

business within the United States.

Table 2-1 shows the general rules for determining

whether income is from sources within the United States.

Types of Income

2.

Territory Source Income

In order to determine where to file your return and which

form(s) you need to complete, you may need to determine

the source of each item of income you received during the

tax year.

This section looks at the most common types of income

received by individuals, and the rules for determining the

source of the income. Generally, the same rules shown in

Table 2-1 are used to determine if you have territory

source income.

Table 2-1. General Rules for Determining U.S. Source of Income

Item of income

Factor determining source

Salaries, wages, and other compensation for labor or personal

services

Where labor or services performed

Note: See Compensation for Labor or Personal Services.

Pensions

Contributions: Where services were performed that earned the pension

Investment earnings: Where pension trust is located

Interest

Residence of payer

Dividends

Where corporation created or organized

Rents

Location of property

Royalties:

Natural resources

Patents, copyrights, etc.

Location of property

Where property is used

Sale of business inventory—purchased

Where sold

Sale of business inventory—produced

Where sold unless sold within the Unites States. Allocation if purchased in U.S.

territory and sold within the United States.

Sale of real property

Location of property

Sale of personal property

Seller’s tax home (but see Special Rules for Gains From Dispositions of

Certain Property, later, for exceptions)

Sale of natural resources

Allocation based on fair market value of product at export terminal. For more

information, see Regulations section 1.863-1(b).

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Chapter 2

Territory Source Income

11

Compensation for Labor or Personal

Services

Income from labor or personal services includes wages,

salaries, commissions, fees, per diem allowances, employee allowances and bonuses, and fringe benefits. It

also includes income earned by sole proprietors and general partners from providing personal services in the

course of their trades or businesses.

Services performed wholly within a relevant territory.

Generally, all pay you receive for services performed in a

relevant territory is considered to be from sources within

that territory. However, there are exceptions to this rule as

discussed further below.

U.S. Armed Forces. Generally, military service pay

during active duty will be sourced based on an individual’s

state of legal residence, regardless of where services are

performed. Accordingly, if you are a bona fide resident of a

relevant territory, your military service pay on active duty

will be sourced in that territory even if you perform the

services in the United States or another territory.

Civilian spouse of active duty member of the U.S.

Armed Forces. If you are a bona fide resident of a U.S.

territory and choose to keep that territory as your tax residence under MSRRA when relocating with your service

member spouse under military orders, the source of income for your labor or personal services is considered to

be that territory. Likewise, if your tax residence is in one of

the 50 states or the District of Columbia before relocating

and you choose to keep it as your tax residence, the

source of income for services performed in any of the U.S.

territories is considered to be the United States and, specifically, your state of residence or the District of Columbia.

For more information, see the following.

• Notice 2010-30, available at IRS.gov/irb/

2010-18_IRB#NOT-2010-30.

• Notice 2011-16, available at IRS.gov/irb/

2011-17_IRB#NOT-2011-16.

• Notice 2012-41, available at IRS.gov/irb/

2012-26_IRB#NOT-2012-41.

Also, you can consult with state, local, or U.S. territory

tax authorities regarding your tax obligations under

MSRRA.

Services performed partly inside and partly outside a

relevant territory. If you are an employee and receive

compensation for labor or personal services performed

both inside and outside the relevant territory, special rules

apply in determining the source of the compensation.

Compensation (other than certain fringe benefits) is

sourced on a time basis. Certain fringe benefits (such as

housing and education) are sourced on a geographical

basis.

Or you may be permitted to use an alternative basis to

determine the source of compensation. See Alternative

basis, later.

If you are self-employed, determine the source of your

income for labor or personal services from self-employment on the basis that most correctly reflects the proper

source of that income under the facts and circumstances

of your particular case. In many cases, the facts and circumstances will call for an apportionment on a time basis,

as explained next.

Time basis. Use a time basis to figure your compensation for labor or personal services from the relevant territory (other than the fringe benefits discussed later). Do

this by multiplying your total compensation (other than the

fringe benefits discussed later) by the following fraction:

Number of days you performed services in the relevant

territory during the year

Total number of days you performed services during the year

You can use a unit of time less than a day in the above

fraction, if appropriate. The time period for which the income is made does not have to be a year. Instead, you

can use another distinct, separate, and continuous time

period if you can establish to the satisfaction of the IRS

that this other period is more appropriate.

Example. In 2025, you worked in your employer’s office in the United States for 60 days and in the Puerto Rico

office for 180 days, earning a total of $80,000 for the year.

Your Puerto Rico source income is $60,000, figured as follows.

180 days

240 days

×

$80,000

=

$60,000

• Are a U.S. citizen or resident;

• Are not a bona fide resident of that territory;

• Are not employed by or under contract with an individ-

Multi-year compensation. The source of multi-year

compensation is generally determined on a time basis

over the period to which the compensation is attributable.

Multi-year compensation is compensation that is included

in your income in 1 tax year but is attributable to a period

that includes 2 or more tax years. You determine the period to which the income is attributable based on the facts

and circumstances of your case. For more information on

multi-year compensation, see Regulations section

1.861-4(b).

• Temporarily perform services in that territory for 90

Certain fringe benefits sourced on a geographical

basis. If you received any of the following fringe benefits

as compensation for labor or services performed as an

De minimis exception. There is an exception to the rule

for determining the source of income earned in a territory.

Generally, you will not have income from a territory if during a tax year you:

ual, partnership, or corporation that is engaged in a

trade or business in that territory;

days or less; and

• Earned $3,000 or less from such services.

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Territory Source Income

Publication 570 (2025)

employee partly inside and partly outside a relevant territory, you must source that income on a geographical basis.

• Housing.

• Education.

• Local transportation.

• Tax reimbursement.

• Hazardous or hardship duty pay.

• Moving expense reimbursement.

For information on determining the source of the fringe

benefits listed above, see Regulations section 1.861-4(b).

Alternative basis. You can determine the source of

your compensation under an alternative basis if you establish to the satisfaction of the IRS that, under the facts and

circumstances of your case, the alternative basis more

properly determines the source of your income than the

time or geographical basis. If you use an alternative basis,

you must keep (and have available for inspection) records

to document why the alternative basis more properly determines the source of your income.

Pensions. Generally, pension income has two components: contributions to the pension plan and the earnings

accrued from investing those contributions. The contribution portion is sourced according to where services were

performed that earned the pension. The investment earnings portion is sourced according to the location of the

pension trust making the distributions.

Example. You are a U.S. citizen who worked in Puerto

Rico for a U.S. company. All services were performed in

Puerto Rico. Upon retirement, you remained in Puerto

Rico and began receiving your pension from the U.S. pension trust of your employer. Distributions from the U.S.

pension trust must be allocated between (1) contributions,

which are Puerto Rico source income; and (2) investment

earnings, which are U.S. source income.

Disaster and coronavirus-related tax relief. If you

are required to file a U.S. federal income tax return, you

may be entitled to some special disaster and coronavirus-related rules regarding the use of retirement funds. For

more information, see Form 8915-F and its instructions.

To determine whether you are required to file a U.S. income tax return, see chapter 3.

Investment Income

This category includes such income as interest, dividends, rents, and royalties.

Interest income. The source of interest income is generally determined by the residence of the payer. Interest

paid by corporations created or organized in a relevant territory (territory corporation) or by individuals who are bona

fide residents of a relevant territory is considered income

from sources within that territory.

However, there is an exception to this rule if you are a

bona fide resident of a relevant territory, receive interest

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Chapter 2

from a corporation created or organized in that territory,

and are a shareholder of that corporation, and you own,

directly or indirectly, at least 10% of the total voting stock

of the corporation. See Regulations section 1.937-2(i) for

more information.

Dividends. Generally, dividends paid by a corporation

created or organized in a relevant territory will be considered income from sources within that territory. There are

additional rules for bona fide residents of a relevant territory who receive dividend income from territory corporations, and who own, directly or indirectly, at least 10% of

the voting stock of the corporation. For more information,

see Regulations section 1.937-2(g).

Rental income. Rents from property located in a relevant

territory are treated as income from sources within that

territory.

Royalties. Royalties from natural resources located in a

relevant territory are considered income from sources

within that territory.

Also considered territory source income are royalties

received for the use of, or for the privilege of using, in a

relevant territory, patents, copyrights, secret processes

and formulas, goodwill, trademarks, trade brands, franchises, and other like property.

Sales or Other Dispositions of

Property

The source rules for sales or other dispositions of property

are varied. The most common situations are discussed

below.

Real property. Real property includes land and buildings, and generally anything built on, growing on, or attached to land. The location of the property generally determines the source of income from the sale. For example,

if you are a bona fide resident of Guam and sell your home

that is located in Guam, the gain on the sale is sourced in

Guam. If, however, the home you sold was located in the

United States, the gain is U.S. source income.

Personal property. The term “personal property” refers

to property (such as machinery, equipment, or furniture)

that is not real property. Generally, gain (or loss) from the

sale or other disposition is sourced according to the seller’s tax home. If personal property is sold by a bona fide

resident of a relevant territory, the gain (or loss) from the

sale is treated as sourced within that territory.

This rule does not apply to the sale of inventory, intangible property, depreciable personal property, or property

sold through a foreign office or fixed place of business.

The rules applying to sales of inventory are discussed below. For information on sales of the other types of property

mentioned, see Internal Revenue Code section 865.

Inventory. Your inventory is personal property that is

stock in trade or that is held primarily for sale to customers

in the ordinary course of your trade or business. The

Territory Source Income

13

source of income from the sale of inventory depends on

whether the inventory was purchased or produced.

rules discussed earlier, none of your $6,000 gain will be

treated as income from sources within Puerto Rico.

Purchased. Income from the sale of inventory that you

purchased is sourced where you sell the property. Generally, this is where title to the property passes to the buyer.

However, income from the sale of inventory purchased

within a U.S. territory and sold within the United States is

sourced based on an allocation. For information on making the allocation, see Regulations section 1.863-3.

Caution: The source rules discussed in the preceding

paragraphs supplement, and may apply in conjunction

with, an existing special rule. This existing special rule applies if you are a U.S. citizen or resident alien who becomes a bona fide resident of American Samoa, the

CNMI, or Guam, and who has gain from the disposition of

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

when you became a bona fide resident. The gain is U.S.

source income that is generally subject to U.S. tax if the

property is either (1) located in the United States; (2) stock

issued by a U.S. corporation or a debt obligation of a U.S.

person or of the United States, a state (or political subdivision), or the District of Columbia; or (3) property that has a

basis in whole or in part by reference to property described in (1) or (2). See chapter 3 for filing information.

Produced. Income from the sale of inventory that you

produced in a relevant territory and sold outside that territory (or vice versa) is sourced based on an allocation. For

information on making the allocation, see Regulations

section 1.863-3.

Special Rules for Gains From Dispositions

of Certain Property

There are special rules for gains from dispositions of certain investment property (for example, stocks, bonds, debt

instruments, diamonds, and gold) owned by a U.S. citizen

or resident alien prior to becoming a bona fide resident of

a territory. You are subject to these special rules if you

meet both of the following conditions.

• For the tax year for which the source of the gain must

be determined, you are a bona fide resident of the relevant territory.

• For any of the 10 years preceding that year, you were

a citizen or resident alien of the United States (other

than a bona fide resident of the relevant territory).

If you meet these conditions, gains from the disposition

of this property will not be treated as income from sources

within the relevant territory for purposes of the Internal

Revenue Code. Accordingly, bona fide residents of American Samoa and Puerto Rico, for example, may not exclude the gain on their U.S. tax return. (See chapter 3 for

additional filing information.) With respect to the CNMI,

Guam, and the USVI, the gain from the disposition of this

property will not meet the requirements for certain tax

rules that may allow bona fide residents of those territories

to reduce or obtain a rebate of taxes on income from sources within the relevant territories.

For details, see Regulations section 1.937-2(f)(1) and

Examples 1 and 2 of section 1.937-2(k).

Example 1. In 2019, you, a U.S. citizen, lived in the

United States and paid $1,000 for 100 shares of stock in

the Rose Corporation, a U.S. corporation listed on the

New York Stock Exchange. On March 1, 2022, you moved

to Puerto Rico and changed your tax home to Puerto Rico

on the same date. You satisfied the presence test in 2022

and, under the year-of-move exception, you were considered a bona fide resident of Puerto Rico for the rest of

2022. On March 1, 2022, the closing value of your stock in

the Rose Corporation was $2,000. On January 5, 2025,

while still a bona fide resident of Puerto Rico, you sold all

your Rose Corporation stock for $7,000. Under the special

14

Chapter 2

Special election. You can choose to treat the part of gain

(or loss) attributable to the time you held the property

while a bona fide resident of the relevant territory (the territory holding period) as gain (or loss) from sources within

that territory. Make the election by reporting the gain attributable to the territory holding period on your income tax

return for the year of disposition. This election overrides

both of the special rules discussed earlier.

There are two methods for figuring the gain (or loss) for

the territory holding period, one for marketable securities

and another for other types of investment property.

Marketable securities. Marketable securities are

those actively traded on an established financial market,

such as stock in a publicly held corporation. Under the

special election, allocate the gain (or loss) by figuring the

appreciation separately for your territory and U.S. holding

periods.

Your territory holding period begins on the first day you

do not have a tax home outside the relevant territory. The

gain (or loss) attributable to the territory holding period is

the difference in fair market value of the security at the

close of the market on the first and last days of this holding period. This is your gain (or loss) that is treated as being from sources within the relevant territory. If you were a

bona fide resident of the relevant territory for more than

one continuous period, combine the gains (or losses) from

each territory holding period.

Example 2. Assume the same facts as in Example 1,

except that you make the special election to allocate the

gain between your U.S. and territory holding periods. Your

territory holding period began March 1, 2022, the date

your tax home changed to Puerto Rico. Therefore, the portion of the gain attributable to your territory holding period

is $5,000 ($7,000 sale price – $2,000 closing value on the

first day of the territory holding period). By reporting

$5,000 of your $6,000 gain as Puerto Rico source income

on your 2025 Puerto Rico tax return (and the remainder as

non-Puerto Rico source income), you elect to treat that

amount as Puerto Rico source income.

Other personal property. For personal property other

than marketable securities, use a time-based allocation.

Territory Source Income

Publication 570 (2025)

Figure the gain (or loss) attributable to the territory holding

period by multiplying your total gain (or loss) by the following fraction.

An office or other fixed place of business is a material

factor if it significantly contributes to, and is an essential

economic element in, the earning of the income.

Number of days in the territory holding period

The three kinds of income from sources outside the relevant territory to which these rules apply are the following.

Total number of days in your holding period

The result is your gain (or loss) that is treated as being

from sources within the relevant territory.

Example 3. In addition to the stock in Rose Corporation, you acquired a 5% interest in the Alder Partnership

on January 1, 2021. On March 1, 2022, when you established bona fide residency in Puerto Rico, your partnership interest was not considered a marketable security. On

September 15, 2025, while still a bona fide resident of Puerto Rico, you sold your interest in Alder Partnership for a

$100,000 gain. You had owned the interest for a total of

1,719 days. Your territory holding period (from March 1,

2022, through September 15, 2025) is 1,295 days. The

portion of your gain attributable to Puerto Rico is $75,334

($100,000 x (1,295 Puerto Rico days ÷ 1,719 total days)).

By reporting $75,334 of your $100,000 gain as Puerto

Rico source income on your 2025 Puerto Rico tax return

(and the remainder as non-Puerto Rico source income),

you elect to treat $75,334 as Puerto Rico source income.

1. Rents and royalties for the use of, or for the privilege

of using, intangible personal property located outside

the relevant territory or from any interest in such property. Included are rents or royalties for the use of, or

for the privilege of using, outside the relevant territory,

patents, copyrights, secret processes and formulas,

goodwill, trademarks, trade brands, franchises, and

similar properties if the rents or royalties are from the

active conduct of a trade or business in the relevant

territory.

2. Dividends or interest from the active conduct of a

banking, financing, or similar business in the relevant

territory.

3. Income, gain, or loss from the sale or exchange outside the relevant territory, through the office or other

fixed place of business in the relevant territory, of:

a. Stock in trade,

b. Property that would be included in inventory if on

hand at the end of the tax year, or

c. Property held primarily for sale to customers in the

ordinary course of business.

Scholarships, Fellowships, Grants,

Prizes, and Awards

The source of these types of income is generally the residence of the payer, regardless of who actually disburses

the funds. Therefore, in order to be territory source income, the payer must be a resident of the relevant territory, such as an individual who is a bona fide resident or a

corporation created or organized in that territory.

Caution: These rules do not apply to amounts paid as

salary or other compensation for services. See Compensation for Labor or Personal Services, earlier in this chapter, for the source rules that apply.

Effectively Connected Income

In limited circumstances, some kinds of income from sources outside the relevant territory must be treated as effectively connected with a trade or business in that territory.

These circumstances are listed below.

• You have an office or other fixed place of business in

Item (3) above will not apply if you sold the property for

use, consumption, or disposition outside the relevant territory and an office or other fixed place of business in a foreign country was a material factor in the sale.

Example. You are a bona fide resident of American

Samoa. Your business, which you conduct from an office

in American Samoa, is developing and selling specialized

computer software. A software purchaser will frequently

pay you an additional amount to install the software on the

purchaser’s operating system and to ensure that the software is functioning properly. You install the software at the

purchaser’s place of business, which may be in American

Samoa, in the United States, or in another country. The income from selling the software is effectively connected

with the conduct of your business in American Samoa,

even though the product’s destination may be outside the

territory. However, the compensation you receive for installing the software (personal services) outside of American Samoa is not effectively connected with the conduct

of your business in the territory—the income is sourced

where you perform the services.

the relevant territory to which the income can be attributed.

• That office or place of business is a material factor in

producing the income.

• The income is produced in the ordinary course of the

trade or business carried on through that office or

other fixed place of business.

Publication 570 (2025)

Chapter 2

Territory Source Income

15

return and pay your tax to American Samoa, to the United

States, or to both.

3.

Filing Information for

Individuals in Certain

U.S. Territories

If you have income from American Samoa, the CNMI,

Guam, Puerto Rico, or the USVI, you may have to file a tax

return with the tax department of that territory. Or you may

have to file two annual tax returns, one with the territory’s

tax department and the other with the IRS. This chapter

covers the general rules for filing returns in the five territories.

You must first determine if you are a bona fide resident of

the relevant territory. See chapter 1 for a discussion of the

requirements you must meet.

You should ask for forms and advice about the filing of territory tax returns from that territory’s tax department, not

the IRS. Contact information is listed in this chapter under

the heading for each territory.

Disaster tax relief. If you are required to file an income

tax return with the IRS, you may be entitled to disaster tax

relief. For more information about the tax relief that may be

available, see chapter 4.

American Samoa

American Samoa has its own separate and independent

tax system. Although its tax laws are modeled on the U.S.

Internal Revenue Code, there are certain differences.

Where To Get Forms and Information

Requests for advice about matters connected with American Samoan taxation should be sent to:

American Samoa Government Tax Office

Executive Office Building

Pago Pago, AS 96799

The phone number is 684-633-4181.

You can access the American Samoa Government Tax

Office at www.americansamoa.gov/tax-office.

The fax number is 684-633-1513.

Caution: The addresses and phone numbers listed

above are subject to change.

Which Returns To File

Your residency status and your source of income with regard to American Samoa determine whether you file your

16

Chapter 3

In addition to the information below that is categorized

by residency status, the Special Rules for American Samoa section, later, contains important information for determining the correct forms to file.

Bona Fide Resident of American Samoa

Bona fide residents of American Samoa are generally exempt from U.S. tax on their American Samoa source income.

U.S. citizen or resident alien. If you are a U.S. citizen

(or national) or resident alien and a bona fide resident of

American Samoa during the tax year, you must generally

file the following returns.

• An American Samoa tax return reporting your gross

income from worldwide sources. If you report

non-American Samoa source income on your American Samoa tax return, you can claim a credit against

your American Samoa tax liability for income taxes

paid on that income to the United States, a foreign

country, or another territory.

• A U.S. tax return reporting income from worldwide

sources, but excluding income from sources within

American Samoa. However, amounts received for

services performed as an employee of the United

States or any of its agencies cannot be excluded (see

U.S. Government employees under Special Rules for

American Samoa, later).

To exclude American Samoa source income, attach a

completed Form 4563 to your U.S. tax return (see Form

4563, later, for more information). If you are excluding

American Samoa source income on your U.S. tax return,

you will not be allowed any deductions from gross income

or credits against tax that are directly or indirectly allocable to the excluded income. For more information, see

Special Rules for Completing Your U.S. Tax Return in

chapter 4.

If all of your income is from American Samoa sources,

you are not required to file a U.S. tax return. However, if

you have self-employment income, see Self-employment

tax, later.

Nonresident alien. If you are a bona fide resident of

American Samoa during the tax year, but a nonresident

alien of the United States, you must generally file the following returns.

• An American Samoa tax return reporting worldwide income.

• A U.S. tax return (Form 1040 or 1040-SR) reporting income from worldwide sources, but excluding American Samoa source income other than amounts for

services performed as an employee of the United

States or any of its agencies. For more information,

see U.S. Government employees under Special Rules

for American Samoa, later. To exclude income from

sources within American Samoa, attach a completed

Filing Information for Individuals in Certain U.S.

Territories

Publication 570 (2025)

Form 4563 to your U.S. tax return (see Form 4563,

later, for more information).

For all other tax purposes, however, you will be

treated as a nonresident alien individual. For example,

you are not allowed the standard deduction, you cannot file a joint return, and you are not allowed a deduction for a dependent unless that person is a citizen or

national of the United States. There are also limitations on what deductions and credits are allowed. See

Pub. 519 for more information.

Form 4563. If you must file a U.S. income tax return and

you qualify to exclude any of your income from American

Samoa, claim the exclusion by completing Form 4563 and

attaching it to your Form 1040 or 1040-SR. Form 4563

cannot be filed by itself.

Where to file. If you are a bona fide resident of American

Samoa during the tax year and you are not including a

check or money order, send your U.S. tax return and all attachments (including Form 4563) to:

Department of the Treasury

Internal Revenue Service

Austin, TX 73301-0215

USA

does not apply to any individual who is a nonresident alien

with respect to the United States. See Form 8960 and its

instructions for more information on the NIIT.

Estimated tax payments. To see if you are required to

make payments of estimated income tax, self-employment

tax, Additional Medicare Tax, and/or NIIT to the IRS, get

Form 1040-ES.

To pay by check or money order, send your payment

with the Form 1040-ES payment voucher to:

Internal Revenue Service

P.O. Box 1303

Charlotte, NC 28201-1303

USA

To get information on paying electronically (by credit or

debit card, or through the Electronic Federal Tax Payment

System (EFTPS)), go to IRS.gov/Payments.

For information on making estimated income tax payments to American Samoa, see Where To Get Forms and

Information, earlier.

Not a Bona Fide Resident of American

Samoa

If you are including a check or money order, send your

U.S. tax return and all attachments (including Form 4563)

to:

Internal Revenue Service

P.O. Box 1303

Charlotte, NC 28201-1303

USA

Send your American Samoa tax return and all attachments to the address given under Where To Get Forms

and Information, earlier.

An individual who is not a bona fide resident of American

Samoa for the tax year but has income sourced in American Samoa generally files both U.S. and American Samoa

tax returns, and claims a foreign tax credit on the U.S. return for taxes paid to American Samoa.

U.S. citizen or resident alien. If you are a U.S. citizen or

resident alien but not a bona fide resident of American Samoa during the tax year, you must generally file the following returns.

• An American Samoa tax return reporting only your in-

come from sources within American Samoa. Wages

for services performed in American Samoa, whether

for a private employer, the U.S. Government, or otherwise, are income from sources within American Samoa.

Self-employment tax. If you are not required to file a

U.S. tax return but have income that is effectively connected with a trade or business in American Samoa, you must

file Form 1040-SS with the United States. On this form,

you will report your self-employment income to the United

States, and, if necessary, pay self-employment tax on that

income. For more information, see Self-Employment Tax

in chapter 4.

• A U.S. tax return reporting your income from world-

Additional Medicare Tax. You may be required to pay

Additional Medicare Tax. Also, you may need to report Additional Medicare Tax withheld by your employer. For more

information, see Additional Medicare Tax under Special

Rules for Completing Your U.S. Tax Return in chapter 4.

De minimis exception to determining source of income. In certain situations, you will not have income from

a territory. See De minimis exception under Compensation

for Labor or Personal Services in chapter 2.

Net Investment Income Tax (NIIT). The NIIT is 3.8% of

the lesser of an individual’s net investment income or the

excess of the individual’s modified adjusted gross income

over a specified threshold amount. The NIIT will apply to a

bona fide resident of American Samoa if a taxpayer has

modified adjusted gross income from sources outside of

American Samoa that exceeds a specified threshold

amount, for example, $200,000 for single filers. The NIIT

Publication 570 (2025)

Chapter 3

wide sources. You can take a credit against your U.S.

tax liability if you paid income taxes to American Samoa (or other territory or foreign country) and reported

income from those sources on your U.S. tax return.

Nonresident alien. If you are a nonresident alien of the

United States who does not qualify as a bona fide resident

of American Samoa for the tax year, you must generally

file the following returns.

• An American Samoa tax return reporting only your in-

come from sources within American Samoa. In this situation, wages for services performed in American Samoa, whether for a private employer, the U.S.

Filing Information for Individuals in Certain U.S.

Territories

17

Government, or otherwise, is income from sources

within American Samoa.

• A U.S. tax return (Form 1040-NR) reporting U.S.

source income according to the rules for a nonresident

alien. See the Instructions for Form 1040-NR.

Where to file. If you are not a bona fide resident of American Samoa during the tax year, and you are not including

a check or money order, send your U.S. tax return and all

attachments to:

Department of the Treasury

Internal Revenue Service

Austin, TX 73301-0215

USA

If you are including a check or money order, send your

U.S. tax return and all attachments to:

Internal Revenue Service

P.O. Box 1303

Charlotte, NC 28201-1303

USA

Send your American Samoa tax return and all attachments to the address given under Where To Get Forms

and Information, earlier.

Special Rules for American Samoa

In addition to the general rules given earlier for filing U.S.

and American Samoa tax returns, there are some special

rules that apply to certain individuals and types of income.

U.S. Government employees. U.S. Government wages,

including for services performed in American Samoa,

must be included in U.S. gross income and reported on

both your U.S. and American Samoa income tax returns.

Regardless of whether you are a bona fide resident of

American Samoa, you may have to file an income tax return with both the United States and American Samoa.

• You must generally report all income on your U.S. in-

come tax return, regardless of source. Although a

bona fide resident of American Samoa may generally

exclude American Samoa source income from their

U.S. income tax return, pay from the U.S. Government

for services performed in American Samoa must be

included on your U.S. income tax return regardless of

whether you are a bona fide resident of American Samoa. You can claim a withholding credit on your U.S.

income tax return for federal income taxes withheld

from your federal wages (as well as a foreign tax credit

for income tax paid to American Samoa on the same

income).

• On your American Samoa income tax return, you must

report all income from American Samoa sources (and

from all other sources if you are a bona fide resident of

American Samoa), including your wages from the U.S.

Government for services performed in American Samoa. For further information about your American

Samoa income tax obligations, contact the American

18

Chapter 3

Samoa Government Tax Office at the address and

phone number indicated in chapter 3.

Active duty member of the U.S. Armed Forces. If you

are an active duty member of the U.S. Armed Forces

whose state of legal residence is American Samoa, your

military income is American Samoa-source income. In this

case, you will follow the tax rules for U.S. Government employee wages above, regardless of where you are stationed. If you are an active duty member of the U.S.

Armed Forces whose state of legal residence is not American Samoa, the source of your military wages is generally

the same as your state of legal residence (that is, not

sourced in American Samoa). In that case, you will follow

the tax rules for U.S. Government employee wages for

your state of legal residence, regardless of where you are

stationed.

Civilian spouse of active duty member of the U.S.

Armed Forces. If you are a civilian spouse of an active

duty member of the U.S. Armed Forces, see Special rule

for civilian spouse of active duty member of the U.S.

Armed Forces in chapter 1 for more information.

The spouse of the service member may elect to use the

same residence for tax purposes as the service member

regardless of the date on which the marriage of the

spouse and service member occurred.

Federal retiree pension income. Federal retirees who

are bona fide residents of American Samoa must file an

income tax return with American Samoa to report all income from all sources, including federal pension income.

The retiree may also have an income tax filing requirement

with the United States, depending upon the source of the

retiree’s pension income. Pension income can have multiple sources. See Pensions and other source of income

rules in chapter 2 for more information. If any part of the

pension income is sourced in the United States, the retiree must also file an income tax return with the United

States.

Disaster and coronavirus-related tax relief. If you

are required to file a U.S. federal income tax return, you

may be entitled to some special disaster and coronavirus-related rules regarding the use of retirement funds. For

more information, see Form 8915-F and its instructions.

Moving expense deduction. The deduction for moving

expenses is suspended unless you are a member of the

U.S. Armed Forces who moves pursuant to a military order and incident to a permanent change of station. For

more information, see Pub. 3.

Double Taxation

A mutual agreement procedure exists to settle cases of

double taxation between the United States and American

Samoa. See Double Taxation in chapter 4.

Filing Information for Individuals in Certain U.S.

Territories

Publication 570 (2025)

If all of your income is from Puerto Rico sources, you

are not required to file a U.S. tax return. However, if you

have self-employment income, see Self-employment tax,

later.

The Commonwealth of Puerto

Rico

The Commonwealth of Puerto Rico has its own separate

and independent tax system. Although it is modeled after

the U.S. system, there are differences in law and tax rates.

Where To Get Forms and Information

Requests for information about the filing of Puerto Rico tax

returns should be addressed to:

Departamento de Hacienda

Área de Política Contributiva

P.O. Box 9024140

San Juan, Puerto Rico 00902-4140

The phone

787-620-2323.

numbers

You can access

www.hacienda.pr.gov.

the

are

Nonresident alien. If you are a bona fide resident of Puerto Rico during the tax year, but a nonresident alien of the

United States, you must generally file the following returns.

787-622-0123

Hacienda

website

and

at

Caution: The addresses and phone numbers listed

above are subject to change.

Which Returns To File

Generally, you will file returns with both Puerto Rico and

the United States. The income reported on each return

depends on your residency status in Puerto Rico. To determine if you are a bona fide resident of Puerto Rico and

have income sourced within and outside Puerto Rico, see

the information in chapter 1.

Bona Fide Resident of Puerto Rico

Bona fide residents of Puerto Rico will generally pay tax to

Puerto Rico on their worldwide income.

U.S. citizen or resident alien. If you are a U.S. citizen or

resident alien and also a bona fide resident of Puerto Rico

during the tax year, you must generally file the following

returns.

• A Puerto Rico tax return reporting income from world-

wide sources. If you report U.S. source income on

your Puerto Rico tax return, you can claim a credit

against your Puerto Rico tax, up to the amount allowable, for income taxes paid to the United States.

• A U.S. tax return reporting income from worldwide

sources, but excluding Puerto Rico source income.

However, see U.S. Government employees under

Special Rules for Puerto Rico, later, for an exception.

If you are excluding Puerto Rico income on your U.S.

tax return, you will not be allowed any deductions or credits that are directly or indirectly allocable to exempt income. For more information, see Special Rules for Completing Your U.S. Tax Return in chapter 4.

Publication 570 (2025)

Chapter 3

U.S. citizen only. If you are a U.S. citizen, you may also

qualify under these rules if you have been a bona fide resident of Puerto Rico for at least 2 years before moving from

Puerto Rico. In this case, you can exclude your income

derived from sources within Puerto Rico (but not wages

and salaries received as an employee of the U.S. Government or its agencies) that you earned before the date you

changed your residence. For more information, see Puerto

Rico under Year of Moving From a Territory in chapter 1.

• A Puerto Rico tax return reporting income from world-

wide sources. If you report U.S. source income on

your Puerto Rico tax return, you can claim a credit

against your Puerto Rico tax, up to the amount allowable, for income taxes paid to the United States.

• A U.S. tax return (Form 1040 or 1040-SR) reporting income from worldwide sources, but excluding Puerto

Rico source income (other than amounts for services

performed as an employee of the United States or any

of its agencies). For tax purposes other than reporting

income, however, you will be treated as a nonresident

alien individual. For example, you are not allowed the

standard deduction, you cannot file a joint return, and

you are not allowed a deduction for a dependent unless that person is a citizen or national of the United

States. There are also limitations on what deductions

and credits are allowed. See Pub. 519 for more information.

Self-employment tax. If you have no U.S. filing requirement but have income that is effectively connected with a

trade or business in Puerto Rico, you must file Form

1040-SS with the United States to report your self-employment income and, if necessary, pay self-employment tax.

For more information, see Self-Employment Tax in chapter 4.

Additional Medicare Tax. You may be required to pay

Additional Medicare Tax. Also, you may need to report Additional Medicare Tax withheld by your employer. For more

information, see Additional Medicare Tax under Special

Rules for Completing Your U.S. Tax Return in chapter 4.

Net Investment Income Tax (NIIT). The NIIT is 3.8% of

the lesser of an individual’s net investment income or the

excess of the individual’s modified adjusted gross income

over a specified threshold amount. The NIIT will apply to a

bona fide resident of Puerto Rico if a taxpayer has modified adjusted gross income from sources outside of Puerto

Rico that exceeds a specified threshold amount, for example, $200,000 for single filers. The NIIT does not apply to

any individual who is a nonresident alien with respect to

Filing Information for Individuals in Certain U.S.

Territories

19

the United States. See Form 8960 and its instructions for

more information on the NIIT.

Estimated tax payments. To see if you are required to

make payments of estimated income tax, self-employment

tax, Additional Medicare Tax, and/or NIIT to the IRS, get

Form 1040-ES.

To pay by check or money order, send your payment

with the Form 1040-ES payment voucher to:

Internal Revenue Service

P.O. Box 1303

Charlotte, NC 28201-1303

USA

Where to file. Use the addresses listed below to file your

U.S. and Puerto Rico income tax returns.

If you are not including a check or money order, send

your U.S. tax return and all attachments to:

Department of the Treasury

Internal Revenue Service

Austin, TX 73301-0215

USA

If you are including a check or money order, send your

U.S. tax return and all attachments to:

To get information on paying electronically (by credit or

debit card, or through the Electronic Federal Tax Payment

System (EFTPS)), go to IRS.gov/Payments.

For information on making estimated income tax payments to Hacienda, see Where To Get Forms and Information, earlier.

Not a Bona Fide Resident of Puerto Rico

An individual who is not a bona fide resident of Puerto

Rico for the tax year may have to file tax returns with both

Puerto Rico and the United States.

U.S. citizen or resident alien. If you are a U.S. citizen or

resident alien but not a bona fide resident of Puerto Rico

during the tax year, you must generally file the following

returns.

• A Puerto Rico tax return reporting only your income

from Puerto Rico sources. Wages for services performed in Puerto Rico, whether for a private employer,

the U.S. Government, or otherwise, are income from

Puerto Rico sources.

• A U.S. tax return reporting income from worldwide

sources. Generally, you can claim a foreign tax credit

for income taxes paid to Puerto Rico on the Puerto

Rico income that is subject to Puerto Rico taxes and

not exempt from U.S. taxes (see chapter 4 for more information).

Nonresident alien. If you are a nonresident alien of the

United States who does not qualify as a bona fide resident

of Puerto Rico for the tax year, you must generally file the

following returns.

• A Puerto Rico tax return reporting only your income

from Puerto Rico sources. Wages for services performed in Puerto Rico, whether for a private employer,

the U.S. Government, or otherwise, is income from

Puerto Rico sources.

Internal Revenue Service

P.O. Box 1303

Charlotte, NC 28201-1303

USA

If you request a refund on your Puerto Rico return, send

your Puerto Rico tax return and all attachments to:

Departamento de Hacienda

P.O. Box 9024140

San Juan, PR 00902-6272

Send all other Puerto Rico tax returns, with all attachments, to:

Departamento de Hacienda

P.O. Box 9024140

San Juan, PR 00902-2501

Special Rules for Puerto Rico

In addition to the general rules given earlier for filing U.S.

and Puerto Rico tax returns, there are some special rules

that apply to certain individuals and types of income.

U.S. Government employees. Wages and cost-of-living

allowances paid by the U.S. Government (or one of its

agencies) for working in Puerto Rico are Puerto Rico

source income and thus subject to Puerto Rico tax. However, the cost-of-living allowances are excluded from Puerto Rico gross income up to the amount exempt from

U.S. tax. In order to claim this exclusion, you must:

• Include with your Puerto Rico tax return evidence to

show the amount received during the year, and

• Be in full compliance with your Puerto Rico tax responsibilities.

rules for a nonresident alien. See the Instructions for

Form 1040-NR.

Although bona fide residents of Puerto Rico may generally exclude Puerto Rico source income from their U.S. tax

return, these wages are also subject to U.S. tax because

U.S. Government wages do not qualify for the exclusion.

However, the cost-of-living allowances are excludable

from U.S. gross income. A foreign tax credit is available in

order to avoid double taxation.

De minimis exception to determining source of income. In certain situations, you will not have income from

a territory. See De minimis exception under Compensation

for Labor or Personal Services in chapter 2.

Active duty member of the U.S. Armed Forces. If you

are an active duty member of the U.S. Armed Forces

whose state of legal residence is Puerto Rico, your military

income is Puerto Rico-source income. In this case, you

• A U.S. tax return (Form 1040-NR) according to the

20

Chapter 3

Filing Information for Individuals in Certain U.S.

Territories

Publication 570 (2025)

will follow the tax rules for U.S. Government employee wages above, regardless of where you are stationed. If you

are an active duty member of the U.S. Armed Forces

whose state of legal residence is not Puerto Rico, the

source of your military wages is generally the same as

your state of legal residence (that is, not sourced in Puerto

Rico). In that case, you will follow the tax rules for U.S.

Government employee wages for your state of legal residence, regardless of where you are stationed.

Civilian spouse of active duty member of the U.S.

Armed Forces. If, under the rule discussed at the beginning of chapter 1 (see Special rule for civilian spouse of

active duty member of the U.S. Armed Forces), your tax

residence is Puerto Rico, follow the guidance in the section for bona fide residents under Which Returns To File,

earlier. However, if your tax residence is one of the 50

states or the District of Columbia and your only income

from Puerto Rico is from wages, salaries, tips, or self-employment, you will be taxed on your worldwide income and

file only a U.S. tax return (Form 1040 or 1040-SR) and a

state and/or local tax return, if required. If you have income from Puerto Rico other than wages, salaries, tips, or

self-employment that is considered to be sourced in that

territory (see Table 2-1), contact the Hacienda for guidance.

The spouse of the service member may elect to use the

same residence for tax purposes as the service member

regardless of the date on which the marriage of the

spouse and service member occurred.

Income from sources outside Puerto Rico and the

United States. If you are a U.S. citizen and bona fide resident of Puerto Rico and you have income from sources

outside both Puerto Rico and the United States, that income is treated as foreign source income under both tax

systems. In addition to your Puerto Rico and U.S. tax returns, you may also have to file a return with the country or

territory from which your outside income was derived. To

avoid double taxation, a foreign tax credit is generally

available for either the U.S. or Puerto Rico return.

Example. You are a bona fide resident of Puerto Rico

and a U.S. citizen. You traveled to the Dominican Republic

and worked in the construction industry for 1 month. Your

wages were $20,000. Because the wages were earned

outside Puerto Rico and outside the United States, you

must file a tax return with Puerto Rico and the United

States. You may also have to file a tax return with the

Dominican Republic.

Moving expense deduction. The deduction for moving

expenses is suspended unless you are a member of the

U.S. Armed Forces who moves pursuant to a military order and incident to a permanent change of station. For

more information, see Pub. 3.

Additional child tax credit (ACTC). If you are not required to file a U.S. income tax return, this credit is available only if you meet all three of the following conditions.

• Social security and Medicare taxes were withheld from

your wages or you paid self-employment tax.

• You had one or more qualifying children. (For the definition of a qualifying child, see the Instructions for

Form 1040-SS.)

If your income exceeds certain levels, you may be disqualified from receiving this credit. Use Form 1040-SS to

claim the ACTC.

Double Taxation

A mutual agreement procedure exists to settle cases of

double taxation between the United States and the Commonwealth of Puerto Rico. See Double Taxation in chapter 4.

The Commonwealth of the

Northern Mariana Islands

The CNMI has its own tax system based partly on the

same tax laws and tax rates that apply to the United

States and partly on local taxes imposed by the CNMI

government.

Where To Get Forms and Information

Requests for advice about CNMI residency and tax matters should be addressed to:

Commonwealth of the Northern Mariana Islands

Division of Revenue and Taxation

P.O. Box 5234 CHRB

Dandan Commercial Center

Saipan, MP 96950

You can order forms and publications by calling

670-664-1000.

You can order forms and publications through fax at

670-664-1015.

You

can

access

the

www.finance.gov.mp/forms.php.

CNMI

website

at

Caution: The addresses and phone numbers listed

above are subject to change.

Which Return To File

In general, all individuals with income from the CNMI will

file only one return, either to the CNMI or to the United

States. Your residency status with regard to the CNMI determines which return you will file. Be sure to check the

Special Rules for the Commonwealth of the Northern Mariana Islands, later, for additional information about filing

your tax return.

• You were a bona fide resident of Puerto Rico during

the entire tax year.

Publication 570 (2025)

Chapter 3

Filing Information for Individuals in Certain U.S.

Territories

21

Bona Fide Resident of the Commonwealth

of the Northern Mariana Islands

If you are a U.S. citizen, resident alien, or nonresident

alien and a bona fide resident of the CNMI during the tax

year, file your income tax return with the CNMI.

• Include income from worldwide sources on your CNMI

return. In determining your total tax payments, include

all income tax withheld and paid to either the CNMI or

the United States, any credit for an overpayment of income tax to either the CNMI or the United States, and

any payments of estimated tax to either the CNMI or

the United States. Pay any balance of tax due with

your tax return.

• Generally, if you properly file your return with, and fully

pay your income tax to, the CNMI, then you are not liable for filing an income tax return with, or for paying tax

to, the United States for the tax year. However, if you

were self-employed in 2025, see Self-employment tax,

later.

Example. You were a bona fide resident of the CNMI

for 2025. You received wages of $30,000 paid by a private

employer in the CNMI and dividends of $4,000 from U.S.

corporations that carry on business mainly in the United

States. You must file a 2025 income tax return with the

CNMI Division of Revenue and Taxation. You report your

total income of $34,000 on the CNMI return.

Where to file. If you are a bona fide resident of the CNMI

for the tax year, send your return and all attachments to

the Division of Revenue and Taxation at the address given

earlier.

• Gross income of $5,000 or more from sources within

the CNMI.

The United States and the CNMI use this form to divide

your income taxes.

De minimis exception to determining source of income. In certain situations, you will not have income from

a territory. See De minimis exception under Compensation

for Labor or Personal Services in chapter 2.

Citizen or resident alien of the United States but not

a bona fide resident of the Commonwealth of the

Northern Mariana Islands. If you are a citizen or resident alien of the United States but not a bona fide resident

of the CNMI during the tax year and you are not including

a check or money order, send your return and all attachments to:

Department of the Treasury

Internal Revenue Service

Austin, TX 73301-0215

USA

If you are including a check or money order, send your

U.S. tax return and all attachments to:

Internal Revenue Service

P.O. Box 1303

Charlotte, NC 28201-1303

USA

Nonresident Alien (Other Than a Bona Fide

Resident of the Commonwealth of the

Northern Mariana Islands)

U.S. Citizen or Resident Alien (Other Than a

Bona Fide Resident of the Commonwealth

of the Northern Mariana Islands)

If you are a nonresident alien of the United States who

does not qualify as a bona fide resident of the CNMI for

the tax year, you must generally file the following returns.

If you have income from sources within the CNMI and are

a U.S. citizen or resident alien, but you are not a bona fide

resident of the CNMI during the tax year, file your income

tax return with the United States.

sources within the CNMI. In this situation, wages for

services performed in the CNMI, whether for a private

employer, the U.S. Government, or otherwise, are income from sources within the CNMI.

• Include income from worldwide sources on your U.S.

return. In determining your total tax payments, include

all income tax withheld and paid to either the United

States or the CNMI, any credit for an overpayment of

income tax to either the United States or the CNMI,

and any payments of estimated tax to either the CNMI

or the United States. Pay any balance of tax due with

your tax return.

Note: You may also need to complete Form 5074.

• You are not liable for filing an income tax return with,

or for paying tax to, the CNMI for the tax year.

Form 5074. If you file a U.S. income tax return, attach a

completed Form 5074 if you (and your spouse if filing a

joint return) have:

• A CNMI tax return reporting only your income from

• A U.S. tax return (Form 1040-NR) reporting U.S.

source income according to the rules for a nonresident

alien. See the Instructions for Form 1040-NR.

If you are not a bona fide resident of the CNMI during

the tax year and you are not including a check or money

order, send your U.S. tax return and all attachments to:

Department of the Treasury

Internal Revenue Service

Austin, TX 73301-0215

USA

If you are including a check or money order, send your

U.S. tax return and all attachments to:

• Adjusted gross income of $50,000 or more for the tax

year, and

22

Chapter 3

Filing Information for Individuals in Certain U.S.

Territories

Publication 570 (2025)

Internal Revenue Service

P.O. Box 1303

Charlotte, NC 28201-1303

USA

Send your CNMI tax return and all attachments to:

Department of Finance

Division of Revenue and Taxation

Commonwealth of the Northern Mariana Islands

P.O. Box 5234 CHRB

Saipan, MP 96950

Citizen of the Commonwealth of the

Northern Mariana Islands

If you are a citizen of the CNMI (meaning that you were

born or naturalized in the CNMI) but not otherwise a U.S.

citizen or a U.S. resident alien during the tax year, file your

income tax return with the CNMI. Include income from

worldwide sources on your CNMI return. Take into account tax withheld by both jurisdictions in determining if

there is tax overdue or an overpayment. Pay any balance

of tax due with your tax return. Send your return and all attachments to:

Department of Finance

Division of Revenue and Taxation

Commonwealth of the Northern Mariana Islands

P.O. Box 5234 CHRB

Saipan, MP 96950

Special Rules for the Commonwealth

of the Northern Mariana Islands

Special rules apply to certain types of income, employment, and filing status.

Joint return. If you file a joint return, file your return (and

pay the tax) with the jurisdiction where the spouse who

has the greater adjusted gross income (AGI) would have

to file if you were filing separately. If the spouse with the

greater AGI is a bona fide resident of the CNMI during the

tax year, file the joint return with the CNMI. If the spouse

with the greater AGI is a U.S. citizen or resident alien but

not a bona fide resident of the CNMI during the tax year,

file your joint return with the United States. For this purpose, income is determined without regard to community

property laws.

Example. You, a U.S. citizen, were a resident of the

United States, and your spouse, a citizen of both the

CNMI and the United States, was a bona fide resident of

the CNMI during the tax year. You earned $65,000 as a

computer programmer in the United States. Your spouse

earned $20,000 as an artist in the CNMI. You and your

spouse will file a joint return. Because you have the

greater AGI, you and your spouse must file your return

with the United States and report the entire $85,000 on

that return.

Publication 570 (2025)

Chapter 3

U.S. Armed Forces. If you are a member of the U.S.

Armed Forces on active duty who qualified as a bona fide

resident of the CNMI in a prior tax year, your absence from

the CNMI solely in compliance with military orders will not

change your bona fide residency. If you did not qualify as

a bona fide resident of the CNMI in a prior tax year, your

presence in the CNMI solely in compliance with military

orders will not qualify you as a bona fide resident of the

CNMI.

Civilian spouse of active duty member of the U.S.

Armed Forces. If, under the rule discussed at the beginning of chapter 1 (see Special rule for civilian spouse of

active duty member of the U.S. Armed Forces), your tax

residence is the CNMI, follow the guidance in the section

for bona fide residents under Which Return To File, earlier.

However, if your tax residence is one of the 50 states or

the District of Columbia and your only income from the

CNMI is from wages, salaries, tips, or self-employment,

you will be taxed on your worldwide income and file only a

U.S. tax return (Form 1040 or 1040-SR) and a state and/or

local tax return, if required. If you have income from the

CNMI other than wages, salaries, tips, or self-employment

that is considered to be sourced in that territory (see Table 2-1), you may need to file Form 5074 with your U.S. tax

return.

The spouse of the service member may elect to use the

same residence for tax purposes as the service member

regardless of the date on which the marriage of the

spouse and service member occurred.

Moving expense deduction. The deduction for moving

expenses is suspended unless you are a member of the

U.S. Armed Forces who moves pursuant to a military order and incident to a permanent change of station. For

more information, see Pub. 3. If you meet these requirements, see the discussion below.

If you are a bona fide resident in the tax year of your

move, enter your deductible expenses on your CNMI tax

return.

If you are not a bona fide resident, enter your deductible expenses on Form 3903, and enter the deductible

amount on Schedule 1 (Form 1040), line 14, and on Form

5074, line 20.

Self-employment tax. If you have no U.S. filing requirement, but have income that is effectively connected with a

trade or business in the CNMI, you must file Form

1040-SS with the United States to report your self-employment income and, if necessary, pay self-employment tax.

Additional Medicare Tax. You may be required to pay

Additional Medicare Tax. Also, you may need to report Additional Medicare Tax withheld by your employer. For more

information, see Additional Medicare Tax under Special

Rules for Completing Your U.S. Tax Return in chapter 4.

Estimated tax payments. To see if you are required to

make payments of estimated income tax, self-employment

tax, and/or Additional Medicare Tax to the IRS, get Form

1040-ES.

Filing Information for Individuals in Certain U.S.

Territories

23

Payment of estimated tax. If you must pay estimated

tax, make your payment to the jurisdiction where you

would file your income tax return if your tax year were to

end on the date your first estimated tax payment is due.

Generally, you should make the rest of your quarterly payments of estimated tax to the jurisdiction where you made

your first payment of estimated tax. However, estimated

tax payments to either jurisdiction will be treated as payments to the jurisdiction with which you file the tax return.

If you make a joint payment of estimated tax, make your

payment to the jurisdiction where the spouse who has the

greater estimated AGI would have to pay (if a separate

payment were made). For this purpose, income is determined without regard to community property laws.

Early payment. If you make your first payment of estimated tax early, follow the rules given earlier to determine

where to send it. If you send it to the wrong jurisdiction,

make all later payments to the jurisdiction to which the first

payment should have been sent.

To pay by check or money order, send your payment

with the Form 1040-ES payment voucher to:

You

can

get

www.guamtax.com.

forms

and

publications

at

Caution: The addresses and phone numbers listed

above are subject to change.

Which Return To File

Bona fide residents of Guam are subject to special U.S.

tax rules. In general, all individuals with income from

Guam will file only one return—either to Guam or the United States.

Bona Fide Resident of Guam

If you are a bona fide resident of Guam during the tax

year, file your return with Guam. This applies to all bona

fide residents who are citizens, resident aliens, or nonresident aliens of the United States.

• Include income from worldwide sources on your Guam

Internal Revenue Service

P.O. Box 1303

Charlotte, NC 28201-1303

USA

To get information on paying electronically (by credit or

debit card, or through the Electronic Federal Tax Payment

System (EFTPS)), go to IRS.gov/Payments.

For information on making estimated income tax payments to the CNMI, see Where To Get Forms and Information, earlier.

Double Taxation

A mutual agreement procedure exists to settle cases of

double taxation between the United States and the Commonwealth of the Northern Mariana Islands. See Double

Taxation in chapter 4.

Guam

Guam has its own tax system based on the same tax laws

and tax rates that apply in the United States.

Where To Get Forms and Information

Requests for advice about Guam residency and tax matters should be addressed to:

Department of Revenue and Taxation

Taxpayer Services Division

P.O. Box 23607

GMF, Guam 96921

You can order forms and publications by calling

671-635-1840 or 671-635-1841.

24

You can order forms and publications through fax at

671-633-2643.

Chapter 3

return. In determining your total tax payments, include

all income tax withheld and paid to either Guam or the

United States, any credit for an overpayment of income tax to either Guam or the United States, and any

payments of estimated tax to either Guam or the United States. Pay any balance of tax due with your tax

return.

• Generally, if you properly file your return with, and fully

pay your income tax to, Guam, then you are not liable

for filing an income tax return with, or for paying tax to,

the United States. However, if you were self-employed

in 2025, see Self-employment tax, later.

Example. You were a bona fide resident of Guam for

2025. You received wages of $25,000 paid by a private

employer in Guam and dividends of $2,000 from U.S. corporations that carry on business mainly in the United

States. You must file a 2025 income tax return with the

government of Guam. You report your total income of

$27,000 on the Guam return.

If you are a bona fide resident of Guam for the tax year,

send your return and all attachments to:

Department of Revenue and Taxation

Taxpayer Services Division

P.O. Box 23607

GMF, Guam 96921

U.S. Citizen or Resident Alien (Other Than a

Bona Fide Resident of Guam)

If you have income from sources within Guam and are a

U.S. citizen or resident alien, but you are not a bona fide

resident of Guam during the tax year, file your income tax

return with the United States.

• Include income from worldwide sources on your U.S.

return. In determining your total tax payments, include

Filing Information for Individuals in Certain U.S.

Territories

Publication 570 (2025)

all income tax withheld and paid to either the United

States or Guam, any credit for an overpayment of income tax to either the United States or Guam, and any

payments of estimated tax to either Guam or the United States. Pay any balance of tax due with your tax

return. You may also need to complete Form 5074.

• You are not liable for filing an income tax return with,

or for paying tax to, Guam for the tax year.

Form 5074. If you file a U.S. income tax return, attach a

completed Form 5074 if you (and your spouse if filing a

joint return) have:

• Adjusted gross income of $50,000 or more for the tax

year, and

• Gross income of $5,000 or more from sources within

Guam.

The United States and Guam use this form to divide

your income taxes.

De minimis exception to determining source of income. In certain situations, you will not have income from

a territory. See De minimis exception under Compensation

for Labor or Personal Services in chapter 2.

If you are a citizen or resident alien of the United States

but not a bona fide resident of Guam during the tax year

and you are not including a check or money order, send

your U.S. tax return and all attachments (including Form

5074) to:

Department of the Treasury

Internal Revenue Service

Austin, TX 73301-0215

USA

If you are including a check or money order, send your

U.S. tax return and all attachments (including Form 5074)

to:

Internal Revenue Service

P.O. Box 1303

Charlotte, NC 28201-1303

USA

Nonresident Alien (Other Than a Bona Fide

Resident of Guam), Where To File

If you are a nonresident alien of the United States who

does not qualify as a bona fide resident of Guam for the

tax year, you must generally file the following returns.

• A Guam tax return reporting only your income from

sources within Guam. In this situation, wages for services performed in Guam, whether for a private employer, the U.S. Government, or otherwise, are income

from sources within Guam.

• A U.S. tax return (Form 1040-NR) reporting U.S.

source income according to the rules for a nonresident

alien. See the Instructions for Form 1040-NR.

If you are not a bona fide resident of Guam during the

tax year and you are not including a check or money order, send your U.S. tax return and all attachments to:

Department of the Treasury

Internal Revenue Service

Austin, TX 73301-0215

USA

If you are including a check or money order, send your

U.S. tax return and all attachments to:

Internal Revenue Service

P.O. Box 1303

Charlotte, NC 28201-1303

USA

Send your Guam tax return and all attachments to:

Department of Revenue and Taxation

Taxpayer Services Division

P.O. Box 23607

GMF, Guam 96921

Citizen of Guam

If you are a citizen of Guam (meaning that you were born

or naturalized in Guam) but not otherwise a U.S. citizen or

a U.S. resident alien during the tax year, file your income

tax return with Guam. Include income from worldwide

sources on your Guam return. Take into account tax withheld by both jurisdictions in determining if there is tax

overdue or an overpayment. Pay any balance of tax due

with your tax return.

If you are a citizen of Guam, send your return and all attachments to:

Department of Revenue and Taxation

Taxpayer Services Division

P.O. Box 23607

GMF, Guam 96921

Special Rules for Guam

Special rules apply to certain types of income, employment, and filing status.

Joint return. If you file a joint return, you should file your

return (and pay the tax) with the jurisdiction where the

spouse who has the greater adjusted gross income (AGI)

would have to file if you were filing separately. If the

spouse with the greater AGI is a bona fide resident of

Guam during the tax year, file the joint return with Guam. If

the spouse with the greater AGI is a U.S. citizen or resident alien but not a bona fide resident of Guam during the

tax year, file the joint return with the United States. For this

purpose, income is determined without regard to community property laws.

Example. You, a U.S. citizen, were a resident of the

United States, and your spouse, a citizen of both Guam

Publication 570 (2025)

Chapter 3

Filing Information for Individuals in Certain U.S.

Territories

25

and the United States, was a bona fide resident of Guam

during the tax year. You earned $45,000 as an engineer in

the United States. Your spouse earned $15,000 as a

teacher in Guam. You and your spouse will file a joint return. Because you have the greater AGI, you and your

spouse must file your return with the United States and report the entire $60,000 on that return.

U.S. Armed Forces. If you are a member of the U.S.

Armed Forces on active duty who qualified as a bona fide

resident of Guam in a prior tax year, your absence from

Guam solely in compliance with military orders will not

change your bona fide residency. If you did not qualify as

a bona fide resident of Guam in a prior tax year, your presence in Guam solely in compliance with military orders will

not qualify you as a bona fide resident of Guam.

Civilian spouse of active duty member of the U.S.

Armed Forces. If, under the rule discussed at the beginning of chapter 1 (see Special rule for civilian spouse of

active duty member of the U.S. Armed Forces), your tax

residence is Guam, follow the guidance in the section for

bona fide residents under Which Return To File, earlier.

However, if your tax residence is one of the 50 states or

the District of Columbia and your only income from Guam

is from wages, salaries, tips, or self-employment, you will

be taxed on your worldwide income and file only a U.S. tax

return (Form 1040 or 1040-SR) and a state and/or local

tax return, if required. If you have income from Guam other

than wages, salaries, tips, or self-employment that is considered to be sourced in that territory (see Table 2-1), you

may need to file Form 5074 with your U.S. tax return.

The spouse of the service member may elect to use the

same residence for tax purposes as the service member

regardless of the date on which the marriage of the

spouse and service member occurred.

Moving expense deduction. The deduction for moving

expenses is suspended unless you are a member of the

U.S. Armed Forces who moves pursuant to a military order and incident to a permanent change of station. For

more information, see Pub. 3. If you meet these requirements, see the discussion below.

If you are a bona fide resident in the tax year of your

move, enter your deductible expenses on your Guam tax

return.

If you are not a bona fide resident, enter your deductible expenses on Form 3903, and enter the deductible

amount on Schedule 1 (Form 1040), line 14, and on Form

5074, line 20.

Self-employment tax. If you have no U.S. filing requirement, but have income that is effectively connected with a

trade or business in Guam, you must file Form 1040-SS

with the United States to report your self-employment income and, if necessary, pay self-employment tax.

Additional Medicare Tax. You may be required to pay

Additional Medicare Tax. Also, you may need to report Additional Medicare Tax withheld by your employer. For more

information, see Additional Medicare Tax under Special

Rules for Completing Your U.S. Tax Return in chapter 4.

26

Chapter 3

Estimated tax payments. To see if you are required to

make payments of estimated income tax, self-employment

tax, and/or Additional Medicare Tax to the IRS, see Form

1040-ES.

Payment of estimated tax. If you must pay estimated

tax, make your payment to the jurisdiction where you

would file your income tax return if your tax year were to

end on the date your first estimated tax payment is due.

Generally, you should make the rest of your quarterly payments of estimated tax to the jurisdiction where you made

your first payment of estimated tax. However, estimated

tax payments to either jurisdiction will be treated as payments to the jurisdiction with which you file the tax return.

If you make a joint payment of estimated tax, make your

payment to the jurisdiction where the spouse who has the

greater estimated AGI would have to pay (if a separate

payment were made). For this purpose, income is determined without regard to community property laws.

Early payment. If you make your first payment of estimated tax early, follow the rules given earlier to determine

where to send it. If you send it to the wrong jurisdiction,

make all later payments to the jurisdiction to which the first

payment should have been sent.

To pay by check or money order, send your payment

with the Form 1040-ES payment voucher to:

Department of Revenue and Taxation

Taxpayer Services Division

P.O. Box 23607

GMF, Guam 96921

To get information on paying electronically (by credit or

debit card, or through the Electronic Federal Tax Payment

System (EFTPS)), go to IRS.gov/Payments.

For information on making estimated income tax payments to the Department of Revenue and Taxation, see

Where To Get Forms and Information, earlier.

Double Taxation

A mutual agreement procedure exists to settle cases of

double taxation between the United States and Guam.

See Double Taxation in chapter 4.

The U.S. Virgin Islands

The USVI has its own tax system based on the same tax

laws and tax rates that apply in the United States. An important factor in USVI taxation is whether, during the tax

year, you are a bona fide resident of the USVI.

Where To Get Forms and Information

For information about filing your USVI tax return or about

Form 1040INFO in St. Thomas, contact:

Filing Information for Individuals in Certain U.S.

Territories

Publication 570 (2025)

You can order forms and publications through fax at

340-774-2672.

For information about filing your USVI tax return or

about Form 1040INFO in St. Croix, contact:

Virgin Islands Bureau of Internal Revenue

4008 Estate Diamond Plot 7-B

Christiansted, USVI 00820-4421

You can order forms and publications by calling

340-773-1040.

You can order forms and publications through fax at

340-773-1006.

You can access the USVI website at http://bir.vi.gov/.

Caution: The addresses and phone numbers listed

above are subject to change.

Which Return To File

In general, bona fide residents of the USVI pay income

taxes only to the USVI. U.S. citizens or resident aliens (but

not bona fide residents of the USVI) with USVI source income pay a portion of the tax to each jurisdiction.

Bona Fide Resident of the U.S. Virgin

Islands

File your tax return with the USVI if you are a U.S. citizen,

resident alien, or nonresident alien and a bona fide resident of the USVI during the tax year.

• Include your worldwide income on your USVI return. In

determining your total tax payments, take into account

all income tax withheld and paid to either the USVI or

the United States, any credit for an overpayment of income tax to either the USVI or the United States, and

any payments of estimated tax to either the USVI or

the United States. Pay any balance of tax due with

your tax return. Filing this return with the USVI generally also starts the statute of limitations on assessment

of your U.S. income tax.

• You generally do not have to file with the United States

for any tax year in which you are a bona fide resident

of the USVI during the tax year, provided you report

and pay tax on your income from all sources to the

USVI and identify the source(s) of the income on the

return.

• If you have self-employment income, you may be re-

quired to file Form 1040-SS with the United States.

For more information, see Self-employment tax under

Special Rules for the U.S. Virgin Islands, later.

Publication 570 (2025)

Chapter 3

Bureau of Internal Revenue

6115 Estate Smith Bay

St. Thomas, USVI 00802

U.S. Citizen or Resident Alien (Other Than a

Bona Fide Resident of the U.S. Virgin

Islands)

If you are a U.S. citizen or resident alien but not a bona

fide resident of the USVI during the tax year, you must file

your original Form 1040 or 1040-SR with the United States

and an identical copy of that return with the USVI if you

have:

• Income from sources in the USVI, or

• Income effectively connected with the conduct of a

trade or business in the USVI.

File your original Form 1040 or 1040-SR with the United

States and file a signed copy of the U.S. return (including

all attachments, forms, and schedules) with the U.S. Virgin

Islands Bureau of Internal Revenue by the due date for filing Form 1040 or 1040-SR. Use Form 8689 to figure the

amount of tax you must pay to the USVI.

Form 8689. Complete this form and attach it to both the

return you file with the United States and the copy you file

with the USVI. Figure the amount of tax you must pay to

the USVI as follows:

.

You can order forms and publications by calling

340-715-1040.

Form 1040INFO. If you are a bona fide resident of the

USVI and have non-USVI source income, you must also

file Virgin Islands Bureau of Internal Revenue Form

1040INFO, Non-Virgin Islands Source Income of Virgin Islands Residents, with the USVI. Attach Form 1040INFO to

your USVI tax return before filing. You can get Form

1040INFO by contacting the address or website given earlier.

If you are a bona fide resident of the USVI for the tax

year, file your return and all attachments with the U.S. Virgin Islands Bureau of Internal Revenue at:

.

Virgin Islands Bureau of Internal Revenue

6115 Estate Smith Bay

Suite 225

St. Thomas, USVI 00802

Total tax on U.S. return (after

certain adjustments)

×

USVI AGI

Worldwide AGI

Pay any tax due to the USVI when you file your return

with the U.S. Virgin Islands Bureau of Internal Revenue. To

receive credit on your U.S. return for taxes paid to the

USVI, include the amounts from Form 8689, lines 40 and

45, in the total on Form 1040 or 1040-SR, line 33. On the

dotted line next to line 33, enter “Form 8689” and show the

amounts.

De minimis exception to determining source of income. In certain situations, you will not have income from

a territory. See De minimis exception under Compensation

for Labor or Personal Services in chapter 2.

If you are not a bona fide resident of the USVI during

the tax year, but you have USVI source income, and you

are not including a check or money order, file Form 1040

or 1040-SR and all attachments (including Form 8689)

with the:

Filing Information for Individuals in Certain U.S.

Territories

27

Special Rules for the U.S. Virgin

Islands

Department of the Treasury

Internal Revenue Service

Austin, TX 73301-0215

USA

If you are including a check or money order, send your

U.S. tax return and all attachments (including Form 8689)

to:

Internal Revenue Service

P.O. Box 1303

Charlotte, NC 28201-1303

USA

File a copy of your U.S. Form 1040 or 1040-SR with the

U.S. Virgin Islands Bureau of Internal Revenue at:

Bureau of Internal Revenue

6115 Estate Smith Bay

St. Thomas, USVI 00802

Nonresident Alien (Other Than a Bona Fide

Resident of the U.S. Virgin Islands)

If you are a nonresident alien of the United States who

does not qualify as a bona fide resident of the USVI for the

tax year, you must generally file the following returns.

• A USVI tax return reporting only your income from

sources within the USVI. In this situation, wages for

services performed in the USVI, whether for a private

employer, the U.S. Government, or otherwise, are income from sources within the USVI.

• A U.S. tax return (Form 1040-NR) reporting U.S.

source income according to the rules for a nonresident

alien. See the Instructions for Form 1040-NR.

If you are not a bona fide resident of the USVI during

the tax year, and you are not including a check or money

order, send your U.S. tax return and all attachments (including Form 8689) to:

Department of the Treasury

Internal Revenue Service

Austin, TX 73301-0215

USA

If you are including a check or money order, send your

U.S. tax return and all attachments (including Form 8689)

to:

Internal Revenue Service

P.O. Box 1303

Charlotte, NC 28201-1303

USA

Send your USVI tax return and all attachments to:

Bureau of Internal Revenue

6115 Estate Smith Bay

St. Thomas, USVI 00802

28

Chapter 3

There are some special rules for certain types of income,

employment, and filing status.

Joint return. If you file a joint return, you should file your

return (and pay the tax) with the jurisdiction where the

spouse who has the greater adjusted gross income (AGI)

would have to file if you were filing separately. If the

spouse with the greater AGI is a bona fide resident of the

USVI during the tax year, file the joint return with the USVI.

If the spouse with the greater AGI is a U.S. citizen or resident alien of the United States but not a bona fide resident

of the USVI during the tax year, file the joint return with the

United States. For this purpose, income is determined

without regard to community property laws.

Example. You, a U.S. citizen, were a resident of the

United States, and your spouse, a citizen of both the USVI

and the United States, was a bona fide resident of the

USVI during the tax year. You earned $55,000 as an architect in the United States. Your spouse earned $30,000 as

a librarian in the USVI. You and your spouse will file a joint

return. Because you have the greater AGI, you and your

spouse must file your return with the United States and report the entire $85,000 on that return.

U.S. Armed Forces. If you are a member of the U.S.

Armed Forces on active duty who qualified as a bona fide

resident of the USVI in a prior tax year, your absence from

the USVI solely in compliance with military orders will not

change your bona fide residency. If you did not qualify as

a bona fide resident of the USVI in a prior tax year, your

presence in the USVI solely in compliance with military orders will not qualify you as a bona fide resident of the

USVI.

Civilian spouse of active duty member of the U.S.

Armed Forces. If, under the rule discussed at the beginning of chapter 1 (see Special rule for civilian spouse of

active duty member of the U.S. Armed Forces), your tax

residence is the USVI, follow the guidance in Bona Fide

Residents of the U.S. Virgin Islands under Which Return

To File, earlier. However, if your tax residence is one of the

50 states or the District of Columbia and your only income

from the USVI is from wages, salaries, tips, or self-employment, you will be taxed on your worldwide income and file

only a U.S. tax return (Form 1040 or 1040-SR) and a state

and/or local tax return, if required. If you have income from

the USVI other than wages, salaries, tips, or self-employment that is considered to be sourced in that territory (see

Table 2-1), you may need to file Form 8689 with your U.S.

tax return. In this case, follow the guidance under U.S.

Citizen or Resident Alien (Other Than a Bona Fide Resident of the U.S. Virgin Islands), earlier.

The spouse of the service member may elect to use the

same residence for tax purposes as the service member

regardless of the date on which the marriage of the

spouse and service member occurred.

Filing Information for Individuals in Certain U.S.

Territories

Publication 570 (2025)

Moving expense deduction. The deduction for moving

expenses is suspended unless you are a member of the

U.S. Armed Forces who moves pursuant to a military order and incident to a permanent change of station. For

more information, see Pub. 3. If you meet these requirements, see the discussion below.

If you are a bona fide resident in the tax year of your

move, enter your deductible expenses on your USVI tax

return.

If you are not a bona fide resident, enter your deductible expenses on Form 3903, and enter the deductible

amount on Schedule 1 (Form 1040), line 14, and on Form

8689, line 20.

If your move was to the United States, complete Form

3903, and enter the deductible amount on Schedule 1

(Form 1040), line 14.

Self-employment tax. If you have no U.S. filing requirement, but have income that is effectively connected with a

trade or business in the USVI, you must file Form 1040-SS

with the United States to report your self-employment income and, if necessary, pay self-employment tax.

Additional Medicare Tax. You may be required to pay

Additional Medicare Tax. Also, you may need to report Additional Medicare Tax withheld by your employer. For more

information, see Additional Medicare Tax under Special

Rules for Completing Your U.S. Tax Return in chapter 4.

Estimated tax payments. To see if you are required to

make payments of estimated income tax, self-employment

tax, and/or Additional Medicare Tax to the IRS, get Form

1040-ES.

To pay by check or money order, send your payment

with the Form 1040-ES payment voucher to:

Bureau of Internal Revenue

6115 Estate Smith Bay

St. Thomas, USVI 00802

Double Taxation

A mutual agreement procedure exists to settle cases of

double taxation between the United States and the U.S.

Virgin Islands. See Double Taxation in chapter 4.

4.

Filing U.S. Tax Returns

The information in chapter 3 will tell you if a U.S. income

tax return is required for your situation. If a U.S. return is

required, your next step is to see if you meet the filing requirements. If you do meet the filing requirements, the information presented in this chapter will help you understand the special procedures involved. This chapter

discusses:

• Filing requirements,

• When to file your return,

• Where to send your return,

• How to adjust your deductions and credits if you are

excluding income from American Samoa or Puerto

Rico,

• How to make estimated tax payments and pay

self-employment tax, and

• How to request assistance in resolving instances of

double taxation.

Who Must File

To get information on paying electronically (by credit or

debit card, or through the Electronic Federal Tax Payment

System (EFTPS)), go to IRS.gov/Payments.

For information on making estimated income tax payments to the Bureau of Internal Revenue, see Where To

Get Forms and Information, earlier.

If you are not required to file a territory tax return that includes your worldwide income, you must generally file a

Form 1040 or 1040-SR U.S. income tax return if your

gross income is at least the amount shown in Table 4-1,

for your filing status and age. Use the Instructions for Form

1040 to help you complete Form 1040 or 1040-SR.

Extension of time to file. You can get an automatic

6-month extension of time to file your tax return. See Extension of Time To File in chapter 4. Bona fide residents of

the USVI during the tax year must file a paper Form 4868

with the U.S. Virgin Islands Bureau of Internal Revenue.

Nonresidents of the USVI should file separate extension

requests with the IRS and the U.S. Virgin Islands Bureau

of Internal Revenue and make any payments due to the

respective jurisdictions. However, the U.S. Virgin Islands

Bureau of Internal Revenue will honor an extension request that is timely filed with the IRS.

As discussed in chapter 3, bona fide residents of the

CNMI, Guam, and the U.S. Virgin Islands do not generally

have an income tax filing requirement with the IRS. Bona

fide residents of American Samoa and Puerto Rico may

have to file an income tax return with the IRS, the territory

tax department, or both, as discussed in chapter 3. These

individuals will have to file an income tax return with the

IRS if they have income that is sourced outside the territory in an amount that exceeds U.S. filing requirements.

Publication 570 (2025)

Chapter 4

Some individuals (such as those who can be claimed

as a dependent on another person’s return or who owe

certain taxes, such as self-employment tax) must file a tax

return even though the gross income is less than the

amount shown in Table 4-1 for their filing status and age.

For more information, see the Instructions for Form 1040.

Filing U.S. Tax Returns

29

Filing Requirement for U.S. Income

Tax Return if Territory Income Is

Excluded

Born Before January 2, 1961, or Were Blind in the 2025

Instructions for Form 1040.

Bona fide residents of American Samoa or Puerto Rico

are required to file a U.S. income tax return if they have

gross income subject to U.S. income tax in an amount that

equals or exceeds the applicable filing requirement. The

filing requirement is generally based on the standard deduction amount used to file a U.S. income tax return

shown in Table 4-1.

You must adjust the standard deduction amount based

on the percentage of gross income subject to U.S. income

tax over gross income from all sources (including excluded territory income) to determine whether you meet the

filing requirement for a U.S. income tax return. To make

this determination, follow the instructions and examples

below.

Standard deduction amount. For 2025, the standard

deduction amounts for all taxpayers are:

Single or Married filing separately . . . $15,750

Head of household . . . . . . . . . . . . . $23,625

Married filing jointly or Qualifying

surviving spouse . . . . . . . . . . . . . . $31,500

Allowable standard deduction. Unless your filing status

is married filing separately, or married filing jointly but you

did not live with your spouse at the end of 2025 (or on the

date your spouse died), the minimum income level at

which you must file a return is generally based on the

standard deduction for your filing status and age. Because

the standard deduction applies to all types of income, it

must be divided between your excluded income and income from other sources. Multiply the regular standard

deduction for your filing status and age by the following

fraction:

Gross income subject to U.S. income tax

Gross income from all sources (including excluded territory

income)

Example. Terry, a U.S. citizen, is single, under 65, and

a bona fide resident of American Samoa. During 2025,

Terry received $20,000 of income from American Samoa

sources (qualifies for exclusion) and $8,000 of income

from sources outside the territory (subject to U.S. income

tax). Terry’s allowable standard deduction for 2025 is figured as follows:

If you or your spouse was born before January 2, 1961,

or either of you is blind, figure your standard deduction using the Standard Deduction Chart for People Who Were

$8,000

$28,000

×

$15,750 (regular

standard deduction)

=

$4,500

Table 4-1. 2025 Filing Requirements Chart for Most Taxpayers

IF your filing status is...

Single

Married filing jointly***

Married filing separately

Head of household

Qualifying surviving spouse

AND at the end of 2025 you were*...

THEN file a return if your gross income**

was at least...

under 65

$15,750

65 or older

$17,750

under 65 (both spouses)

$31,500

65 or older (one spouse)

$33,100

65 or older (both spouses)

$34,700

any age

$5

under 65

$23,625

65 or older

$25,225

under 65

$31,500

65 or older

$33,100

* If you were born on January 1, 1961, you are considered to be age 65 at the end of 2025. (If your spouse died in 2025 or if you are preparing a return for

someone who died in 2025, see Pub. 501.)

** Gross income means all income you received in the form of money, goods, property, and services that is not exempt from tax, including any income from

sources outside the United States or from the sale of your main home (even if you can exclude part or all of it). Do not include any social security benefits

unless (a) you are married filing a separate return and you lived with your spouse at any time during 2025, or (b) one-half of your social security benefits plus

your other gross income and any tax-exempt interest is more than $25,000 ($32,000 if married filing jointly). If (a) or (b) applies, see the Instructions for Form

1040 or Pub. 915 to figure the taxable part of social security benefits you must include in gross income. Gross income includes gains, but not losses,

reported on Form 8949 or Schedule D. Gross income from a business means, for example, the amount on Schedule C, line 7, or Schedule F, line 9. But, in

figuring gross income, do not reduce your income by any losses, including any loss on Schedule C, line 7, or Schedule F, line 9.

*** If you did not live with your spouse at the end of 2025 (or on the date your spouse died) and your gross income was at least $5, you must file a return

regardless of your age.

30

Chapter 4

Filing U.S. Tax Returns

Publication 570 (2025)

Example 1. Casey and Riley Thompson, one over 65,

are U.S. citizens and bona fide residents of Puerto Rico

during the tax year. They file a joint income tax return. During 2025, they received $35,000 of income from Puerto

Rico sources (qualifies for exclusion) and $6,000 of income from sources outside Puerto Rico (subject to U.S.

income tax). Their allowable standard deduction for 2025

is figured as follows:

$6,000

$41,000

×

$33,100 (standard

deduction for 65 or older =

(one spouse))

$4,844

The Thompsons have to file a U.S. income tax return because their gross income subject to U.S. tax ($6,000) is

more than their allowable standard deduction ($4,844).

Example 2. Terry (see Example under Allowable

standard deduction, earlier) must file a U.S. income tax return because their gross income subject to U.S. tax

($8,000) is more than their allowable standard deduction

($4,500).

Tip: If you must file a U.S. income tax return, you may

be able to file electronically using IRS.gov/Efile. See the

Instructions for Form 1040 or visit IRS.gov.

When To File

If you file on a calendar year basis, the due date for filing

your U.S. income tax return is April 15 following the end of

your tax year. If you use a fiscal year (a year ending on the

last day of a month other than December), the due date is

the 15th day of the 4th month after the end of your fiscal

year. If any due date falls on a Saturday, Sunday, or legal

holiday, your tax return is due on the next business day.

For your 2025 tax return, the due date is April 15, 2026.

If you mail your federal tax return, it is considered timely

if it bears an official postmark dated on or before the due

date, including any extensions. If you use a private delivery service designated by the IRS, generally the postmark

date is the date the private delivery service records in its

database or marks on the mailing label. Go to

IRS.gov/PDS for the current list of designated private delivery services.

Caution: Although you are not required to make a payment of the tax you estimate as due, Form 4868 does not

extend the time to pay taxes. If you do not pay the amount

due by the regular due date (generally, April 15), you will

owe interest on any unpaid tax from the original due date

to the date you pay the tax. You may also be charged penalties (see Form 4868).

How to get the automatic extension. You can get the

automatic 6-month extension if you do one of the following

by the due date for filing your return.

• E-file Form 4868 using your personal computer or a

tax professional.

• E-file and pay by credit or debit card. Your payment

must be at least $1. You may pay by phone or over the

Internet. Do not file Form 4868.

• File a paper Form 4868. If you are a fiscal year taxpayer, you must file a paper Form 4868.

See Form 4868 for information on getting an extension

using these options.

When to file. You must request the automatic extension

by the due date for your return. You can file your return any

time before the 6-month extension period ends.

When you file your return. Enter any payment you

made related to the extension of time to file on Schedule 3

(Form 1040), line 10.

Tip: You cannot ask the IRS to figure your tax if you

use the extension of time to file.

Individuals Outside the United States and

Puerto Rico

You are allowed an automatic 2-month extension (until

June 15, 2026, if you use the calendar year) to file your

2025 return and pay any federal income tax due if:

1. You are a U.S. citizen or resident; and

2. On the due date of your return:

a. You are living outside of the United States and Puerto Rico, and your main place of business or post

of duty is outside the United States and Puerto

Rico; or

b. You are in military or naval service on duty outside

the United States and Puerto Rico.

Extension of Time To File

You can get an extension of time to file your U.S. income

tax return. Special rules apply for those living outside the

United States.

However, if you pay the tax due after the regular due

date (generally, April 15), interest will be charged from

April 15 until the date the tax is paid.

Automatic 6-Month Extension

If you serve in a combat zone or qualified hazardous

duty area, you may be eligible for a longer extension of

time to file. For more information, see Pub. 3.

If you cannot file your 2025 return by the due date, you

can get an automatic 6-month extension of time to file.

Example. If your return must be filed by April 15, 2026,

you will have until October 15, 2026, to file.

Publication 570 (2025)

Chapter 4

Filing U.S. Tax Returns

31

Married taxpayers. If you file a joint return, only one

spouse has to qualify for this automatic extension. However, if you and your spouse file separate returns, this automatic extension applies only to the spouse who

qualifies.

How to get the extension. To use this special automatic

extension, you must attach a statement to your return explaining what situation qualified you for the extension.

(See the situations listed in item 2 in the list above.)

Extension beyond 2 months. If you cannot file your

2025 return within the automatic 2-month extension period, you can get an additional 4-month extension, for a total of 6 months. File Form 4868 by the end of the automatic extension period (June 15, 2026, for calendar year

taxpayers). Be sure to check the box on Form 4868, line 8,

if appropriate.

Extension beyond 6 months. In addition to this

6-month extension, taxpayers who are out of the country

(as defined in item 2 in the list above) can request a discretionary 2-month additional extension of time to file their

returns (to December 15, 2026, for calendar year taxpayers).

To request this extension, you must send the IRS a letter explaining the reasons why you need the additional 2

months. Send the letter by the extended due date (October 15 for calendar year taxpayers) to:

Department of the Treasury

Internal Revenue Service

Austin, TX 73301-0215

USA

You will not receive any notification from the IRS unless

your request is denied for being untimely.

Taxpayers Affected by Federally Declared

Disasters

To find information on the most recent tax relief provisions

for taxpayers affected by disaster situations, see Tax relief

in disaster situations on IRS.gov. See Pub. 547 for discussions on the special rules that apply to federally declared

disaster areas.

Where To File

Use the addresses listed below if you have to file Form

1040 or 1040-SR with the United States and you are excluding territory income from American Samoa or Puerto

Rico.

If you are not including a check or money order, send

your U.S. tax return and all attachments to:

Department of the Treasury

Internal Revenue Service

Austin, TX 73301-0215

USA

32

Chapter 4

If you are including a check or money order, send your

U.S. tax return and all attachments to:

Internal Revenue Service

P.O. Box 1303

Charlotte, NC 28201-1303

USA

Send your U.S. return to these addresses if you are attaching Form 5074 or Form 8689. If you are not in either of

the above categories, send your return to the address

shown in the Instructions for Form 1040 for the territory or

state in which you reside.

Special Rules for Completing

Your U.S. Tax Return

The following rules may apply if you are required to file a

U.S. federal income tax return.

Earned income credit. If you are not excluding territory

income from your U.S. tax return, follow the Instructions for

Form 1040. However, you may not qualify to claim the

earned income credit (EIC).

Even if you maintain a household in one of the territories discussed in this publication that is your main home

and the home of your qualifying child, you cannot claim

the EIC on your U.S. tax return. This credit is available

only if you maintain the household in the United States or

you are serving on extended active duty in the U.S. Armed

Forces.

U.S. Armed Forces. U.S. military personnel stationed

outside the United States on extended active duty are

considered to live in the United States during that duty period for purposes of the EIC. Extended active duty means

you are called or ordered to duty for an indefinite period or

for a period of more than 90 days. Once you begin serving

your extended active duty, you are still considered to have

been on extended active duty even if you do not serve

more than 90 days.

Income from American Samoa or Puerto Rico excluded. You will not be allowed to take deductions and credits that apply to the excluded income. The additional information you need follows.

Deductions if Territory Income Is

Excluded

Deductions that specifically apply to your excluded territory income are not allowable on your U.S. income tax return.

Deductions that do not specifically apply to any particular type of income must be divided between your excluded

income from sources in the relevant territory and income

from all other sources to find the part that you can deduct

on your U.S. tax return. Examples of such deductions are

alimony payments, the standard deduction, and certain

Filing U.S. Tax Returns

Publication 570 (2025)

itemized deductions (such as medical expenses, charitable contributions, real estate taxes, and mortgage interest

on your home).

Individual retirement arrangement (IRA) deduction.

Do not take excluded income into account when figuring

your deductible IRA contribution.

Note: Under section 11051 of P.L. 115-97 (TCJA), alimony payments are no longer deductible if the divorce or

separation agreement is executed after December 31,

2018, or if executed before January 1, 2019, but modified

after December 31, 2018, the modification must state that

section 11051 of P.L. 115-97 applies to the modification.

Deductions for qualified tips and qualified overtime.

For purposes of determining eligibility for these deductions, you must include your excluded territory income in

your modified adjusted gross income. The deductions for

qualified tips and qualified overtime compensation may be

claimed on a U.S. tax return only with respect to income

that is included in your U.S. gross income. You may not

claim these deductions on a U.S. tax return when your

qualified tips or qualified overtime compensation are excluded from your U.S. gross income. If part of your qualified tips or overtime compensation is excluded from your

U.S. gross income (for example, because you worked part

of the year within the United States and part of the year

within a territory), you may take a deduction on your U.S.

tax return for qualified tips or qualified overtime compensation only with respect to the qualified tips or qualified

overtime compensation that you did not exclude from your

U.S. gross income.

Figuring the deduction. To find the part of a deduction

that is allowable, multiply the deduction by the following

fraction:

Gross income subject to U.S. income tax

Gross income from all sources (including excluded territory

income)

Adjustments to Income

Your adjusted gross income equals your gross income minus certain deductions (adjustments).

Moving expense deduction. The deduction for moving

expenses is suspended unless you are a member of the

U.S. Armed Forces who moves pursuant to a military order and incident to a permanent change of station. For

more information, see the separate discussions of the

moving expense deduction for each territory in chapter 3.

Self-employment tax deduction. Generally, if you are

reporting self-employment income on your U.S. return,

you can include the deductible part of your self-employment tax on Schedule 1 (Form 1040), line 15. This is an

income tax deduction only; it is not a deduction in figuring

net earnings from self-employment (for self-employment

tax).

However, if you are a bona fide resident of American

Samoa or Puerto Rico and you exclude all of your self-employment income from gross income, you cannot take the

deduction on Schedule 1 (Form 1040), line 15, because

the deduction is related to excluded income.

If only part of your self-employment income is excluded,

the part of the deduction that is based on the nonexcluded

income is allowed. This would happen if, for instance, you

have two businesses and only the income from one of

them is excludable.

For purposes of the deduction only, figure the self-employment tax on the nonexcluded income by multiplying

your total self-employment tax (from Schedule SE (Form

1040)) by the following fraction:

Self-employment income subject to U.S. income tax

Total self-employment income (including excluded territory

income)

The result is your self-employment tax on nonexcluded income. Include the deductible part of this amount on

Schedule 1 (Form 1040), line 15.

Publication 570 (2025)

Chapter 4

Deduction for qualified passenger vehicle loan interest payments. For purposes of determining eligibility for

this deduction, you must include your excluded territory income in your modified adjusted gross income. If you take

the qualified passenger vehicle loan interest payment deduction, you generally must apportion the deduction between the income included in your U.S. tax return and all

other income to find the part that you can deduct on your

U.S. tax return. To find the amount of the deduction that

you can claim on your U.S. tax return, first calculate the full

amount of the qualified passenger vehicle loan interest

payment deduction otherwise allowable. Then multiply the

full amount of the otherwise allowable deduction by the

following fraction.

Gross income subject to U.S. income tax

Gross income from all sources

(including excluded territory income)

Enhanced deduction for seniors. For purposes of determining eligibility for this deduction, you must include

your excluded territory income in your modified adjusted

gross income. If you are eligible for this deduction, you

may claim the full amount of the allowed deduction on

your U.S. tax return.

Standard Deduction

Disaster tax relief. If you are allowed to claim the standard deduction, and you had a net qualified disaster loss

resulting from certain federally declared disasters (see

IRS.gov/DisasterTaxRelief), you can elect to increase your

standard deduction by the amount of your net qualified

disaster loss. You must report your increased standard deduction on Schedule A (Form 1040).

To figure your net qualified disaster loss, see Form

4684 and its instructions. For more information on how to

Filing U.S. Tax Returns

33

report the increased standard deduction, see Line 16 in

the Instructions for Schedule A (Form 1040).

The standard deduction is composed of the regular

standard deduction amount and the additional standard

deduction for taxpayers who are blind or age

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