“There is only one good, knowledge, and one evil, ignorance.” ― Socrates ―

“A good decision is based on knowledge.” ― Plato ―

“The whole is more than the sum of its parts.” ― Aristotle ―

Gather either your last year’s tax return or the last return you filed. Please remember, you need your Puerto Rico Income Tax Return (filed with the Puerto Rico Treasury Dept.), U.S. Income Tax Return (filed with the IRS) and any other state or local income tax return filed in the past. Each taxpayer’s situation is unique. Depending on your particular financial situation, you may have state and local tax filing requirements in the U.S. in addition to your federal tax filing obligations. Please gather all tax return documentation.
If you have bank accounts, investment accounts or other financial assets outside the U.S. (like a foreign pension for example), you may have the obligation to file international financial reports with the U.S. Treasury Dept. Some of these obligations are independent of tax filing requirements; which means, you may have an international financial reporting obligation even if you do not have to pay U.S. Federal Income Taxes. If you filed international financial reports in the past, please gather this documentation as well.
If you travel between Puerto Rico and the U.S. or other overseas locations during the previous year, you will need this information to prepare your tax returns. Your travel dates are used to determine your residency status, as well as to calculate your tax information. If you did not keep a travel log, gather as much information as possible to recreate your travel calendar. Information such as hotel reservations, stamps on your passport, air fare tickets and credit card reports can be used to obtain this data.
Gather all income related documents you receive related to last year. These documents usually arrive early in the year. If you work as an employee, you will receive a form named 499R-2/W-2PR from Puerto Rico employers and a form named W-2 from U.S. employers. If you work as an independent contractor, you will receive a form named 480.6B from Puerto Rico clients and a form named 1099-MISC from U.S. clients. If you have investments, you will receive forms named 1099-INT, 1099-DIV and 1099-B from investment accounts in the U.S. and forms named 480.6B from investment accounts in Puerto Rico.
Depending on the nature of the expense, you may or may not receive a document serving as evidence for the amounts you paid. If you have a U.S. mortgage, you will receive a form titled 1098; for a Puerto Rico mortgage, you will receive a form titled 480.7A. Are you paying student loans? If you are, you will receive a form named 1098-E. Did you make charitable donations? If you did, you may have to request proof of the donation to the charitable organization. Other expenses may not have a specific form attached, like medical expenses. In this case, you will have to keep copies of receipts or other evidence as proof of these payments.

Let’s Work Together

We know how challenging it is to start a new as an International Entrepreneur living in Puerto Rico. You ask yourself: “who can prepare my Puerto Rico taxes this year and explain them to me in English?” I now live in Puerto Rico, my trusted adviser remained back home, and they don’t do Puerto Rico taxes. That is where Caribbean CPA comes in, because being away from home does not mean you have to compromise on the quality of your financial advice. Please contact us for a free consultation.

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