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Hello, I was wondering if anyone has experience with taxation for residents in the US Virgin Islands? If someone is living there long term, how do the tax rates for residents compare with taxes stateside?
Also, does being a resident in the US Virgin Islands give you the right to work on other Caribbean islands?
Question 1: Yes.
Question 2: You file a form 1040 "V.I." with the IRB (internal revenue bureau) and pay exactly what is paid Federally stateside, but you do not file your TAXES stateside. If self-employed, your SE tax (social security, medicare, etc.) is paid stateside. When you move down there, you HAVE to file a form . . . maybe 8832, but something in the "8" range, notifying the feds and the Territory you intend to make bona fide residence there. $1,000 threatened fine if you don't, but I've never heard of anyone being fined, nor of anyone actually doing it but me. There's a whole slew of answers on the IRS website somewhere. Do NOT depend on the IRS for verbal answers. Few employees, as with many statesiders, even know the U.S.V.I. is a territory of the U.S. There is no other income tax for V.I. residents. Year 1 you make split filings, stateside and in the V.I., apportioning taxes to each as appropriate depending on where earned.
Question 3: No. Not even Puerto Rico, which has its own rather twisted tax code.
Advice: Carnival just ended last Saturday on St. Thomas, and, once again, it was a bloodbath. The ignoramous police spokesman threatened ". . . when we see the level of violence exceeding what will we accept, we will shut down carnival." So, multiple shootings during Jouvert and at least 1 or 2 murders on the fringes didn't shut it down, so that must've been acceptable.
Unless you have an extra $25,000/yr. per child to shield the kids and put them in private schools, and the time to spend with them, it is a terrible place to raise kids. I know you said somewhere you went to school on SXM. Fine. In 2010 the V.I. had one of, if not the highest, per capita murder rates in the world (over 10X the U.S. average). Murderers walk away from prosecution every day. The Jamie Cockayne murder on St. John was, and continues to be a fiasco. We did 15 years, were "hooked up" very well in many divergent communities, but I moved my son and his family OUT for education and safety. Some of the biggest criminals are in government employ. You cannot fight the "system" that's in place. Incompetence, nepotism, corruption and self-serving abuse of the populous reigns. And I loved it, but won't be going back.
Maineac - I think the op just wanted to know about taxes and not your regular diatribe of how "terrible" it is here. I'll presume you're living in the most perfect, crime-free, drug-free, gang-free area with perfect teachers that don't have sex with students or peruse porn... electricity is free and you never have to worry about anything.
The OP has a computer and seems to know how to read, so getting reported news on the islands is not the op's interest.
OP didn't ask about carnival. It's been reported. I will agree with you that our biggest criminals are typically seated somewhere within the VI Government.
Not interested in island news? Strange. Too bad the Avis isn't online. We'd know which senators borrowed from the EDC years ago and never paid it back. Hundreds and hundreds of thousands.
This year's Carnival fiasco has been reported to the OP?
Look. Some people just want to tell you to go to the Moving to the V.I. site or some such malarkey and won't hit the real issues. Suck someone in and they could waste a LOT of money getting in and, ultimately, getting out. Lot of problems. The big one is DON'T GO OUT AT NIGHT IN C'STED. Hit an ATM, get robbed (or worse). Again, I never had a problem and hit the one up the street from Rob Jones's place several times after 1:00 AM. This person may think they're going to paradise and everything will come up roses. How's the situation at Luis working for ya? Like I said. We loved the place, but not for everyone and NOT for kids. Highest murder rate under the U.S. flag per capita. Higher rate usually than any other island in the Caribbean. But the OP didn't want to hear that, I guess.
Question 1: Yes.
Question 2: You file a form 1040 "V.I." with the IRB (internal revenue bureau) and pay exactly what is paid Federally stateside, but you do not file your TAXES stateside. If self-employed, your SE tax (social security, medicare, etc.) is paid stateside. When you move down there, you HAVE to file a form . . . maybe 8832, but something in the "8" range, notifying the feds and the Territory you intend to make bona fide residence there. $1,000 threatened fine if you don't, but I've never heard of anyone being fined, nor of anyone actually doing it but me. There's a whole slew of answers on the IRS website somewhere. Do NOT depend on the IRS for verbal answers. Few employees, as with many statesiders, even know the U.S.V.I. is a territory of the U.S. There is no other income tax for V.I. residents. Year 1 you make split filings, stateside and in the V.I., apportioning taxes to each as appropriate depending on where earned.
Question 3: No. Not even Puerto Rico, which has its own rather twisted tax code.
Advice: Carnival just ended last Saturday on St. Thomas, and, once again, it was a bloodbath. The ignoramous police spokesman threatened ". . . when we see the level of violence exceeding what will we accept, we will shut down carnival." So, multiple shootings during Jouvert and at least 1 or 2 murders on the fringes didn't shut it down, so that must've been acceptable.
Unless you have an extra $25,000/yr. per child to shield the kids and put them in private schools, and the time to spend with them, it is a terrible place to raise kids. I know you said somewhere you went to school on SXM. Fine. In 2010 the V.I. had one of, if not the highest, per capita murder rates in the world (over 10X the U.S. average). Murderers walk away from prosecution every day. The Jamie Cockayne murder on St. John was, and continues to be a fiasco. We did 15 years, were "hooked up" very well in many divergent communities, but I moved my son and his family OUT for education and safety. Some of the biggest criminals are in government employ. You cannot fight the "system" that's in place. Incompetence, nepotism, corruption and self-serving abuse of the populous reigns. And I loved it, but won't be going back.
Thank you for answering my questions concerning taxation.
As for the crime in the USVI, seems like a lot of it is drug and gang related.
My wife and I don't have kids yet, but if we did, we would be homeschooling them on the island.
Crime in the V.I. is a problem resulting from the entitlement attitude that permeates the culture. The attitude that everyone is entitled to everything they can get, no matter how they get it, from the Governor down to the 12 year old with a .357 python. That's not a political slap, either, it's simply the way things are. Customer service, from government employees, is virtually non existent. Hmm. Drug and gang related . . . no. There's drugs, and there's gangs, but the typical murder is over a "disrespect" or for revenge and rarely tied directly to illicit drugs or identifiable gangs.
Maineac , glad to see the real deal up here. Presently I'm over at Newsvine.com, tackling the issue of no employment for the people and there being taxed out the ying yang on especially property families have had for generations, some long before any IRS ever came into being and how its essentially contributing to the wrong goings on and I'm getting a fight. You keep telling it like it is. (Please help me blow up the issue, its time to get the World Bank out of the VI and other islands as well, the article is called, >THE I.R..S. On Islands".
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