PR filing for an income tax extension - Federal, IRS Tax Return Extension Form 4868 (2014)

[toddma]

As a previous resident of the states and first time resident of PR, to do an income tax filing extension, do I only file Federal, IRS Tax Return Extension Form 4868, or do I ALSO need to file an equivalent form for PR?

[Hellion1999]

if your income came while you were a resident in the states, you only need to file an extension with the I.R.S. and the state you earned the income (if your state collects income tax)

you only need to deal with the Puerto Rico tax authority with income earned in Puerto Rico that is not from the federal government sources like the Post Office, military, federal contractor or any federal agency in P.R.

[toddma]

My income is from capital gains (selling stock in the stock market), dividends, interest income from US state-based companies. No w-2 income. I filed the IRS form 4898 to get a federal extension. Since Im from FL, which has no state income tax, there is no state income filing for FL, and thus no FL state extension needed, since FL residents and previous residents, like me, don't have to file a state return. I wanted to see if I also had to file an equivalent tax filing extension form to PR as a PR resident.

[Hellion1999]

the question is in 2014 were you a full time resident of Florida or Puerto Rico?

If you were a full time resident of Puerto Rico in 2014, you have to check with Hacienda of Puerto Rico to see if your income from capital gains and dividends and interest are taxable since the tax laws in Puerto Rico changes every year and the Puerto Rican government needs money. Talk to a tax attorney or tax accountant in Puerto Rico ,I'm sure they know all the loopholes in the Puerto Rican tax code.

the good rule of thumb is, where do you keep your money? if you keep your earnings in a bank in the states, they don't have to report to Hacienda of Puerto Rico because Puerto Rico's government has NO JURISDICTION in banks in 50 states. Banks in the 50 states only report to the I.R.S by law......now if you keep your earnings in a bank in Puerto Rico lets say Banco Popular, they do have to report all earnings and interests to Puerto Rico's Hacienda because its under Puerto Rico's jurisdiction. There are a lot of loopholes in the tax code in Puerto Rico being a territory.


If you weren't a full time resident of Puerto Rico in 2014 , screw them, you don't have to report anything to Hacienda of P.R. and only have to deal with the I.R.S......but check with a tax accountant in P.R. to be on the safe side with the Puerto Rican legislature needing money and they taxing anything, I wouldn't want you to get a big bill in the mail.

I would keep your money in a bank in the states just to be on the safe side

[toddma]

I was a full time resident of Puerto Rico

[Hellion1999]

and where do you keep your earnings? is your bank in P.R. or the U.S. Mainland.

banks in the U.S. mainland don't have to report any earnings to the government of Puerto Rico, only to the I.R.S.....banks in Puerto Rico do report to hacienda of Puerto Rico.

Let me give you an example, my wife used to work in Puerto Rico and she had a 401k type of plan from the government of P.R. and she had earnings. When she moved to the U.S., they wouldn't allow her to transfer her account to any U.S. BANK in the mainland like it is done easily in the U.S., she had to transfer her account to their choice of local banks in Puerto Rico and she had to report and pay taxes to the government of Puerto Rico if she closed the account to transfer it to a bank in the U.S...........it was a pain in the a$$ and weird local tax laws......my METLIFE accountant couldn't believe it when I told him of the situation. He thought that was some 3rd world country B.S. and I told him that's the local government of Puerto Rico, making things more complicated for the average folks that's why I left.

Usually how it works if you have a 401k from a job and quit or get fired, you have the option of moving that 401k to any U.S. bank account of your preference without paying a fee or penalties unless you cash it in and then you pay something to the IRS when you do your taxes, there are a few exceptions this can be waiver like hardship or to pay medical bills or death in the immediate family. (loopholes) but you get the point.


I would talk to a tax lawyer in Puerto Rico just to be on the safe side......you could have lots of money in your investments and the Puerto Rican government might want a cut for you being a full time resident and keeping the money in the banks of P.R. where they do report it to Hacienda.....Puerto Rico has some complicated tax laws.


That's why a lot of famous Puerto Ricans who are rich, keep their residences in Florida and their bank accounts. They don't have to pay state income tax and other high taxes like they would in Puerto Rico.