Non-residents are generally taxed on income derived directly or indirectly from sources within Puerto Rico. The general rule is that a person who is a resident of Puerto Rico is taxed on the individual’s worldwide income.However, domiciles will have a greater role in determining whether the taxpayer will be considered a resident or non-resident for Puerto Rican income tax purposes. An individual is presumed to be a resident of Puerto Rico if the individual spends more than 183 days in a calendar year in Puerto Rico. A person can be a resident or a non-resident for Puerto Rican tax purposes. A person’s liability for Puerto Rican tax is determined by residence status.The following are some of the most relevant tax considerations of a temporary or permanent transition to remote work from Puerto Rico: For the Individual (Employee): to Puerto Rico, both the employer and the employees could be facing unintended Puerto Rico and U.S. In the case of employees who have decided to move from the U.S. My previous employer allowed us to at least expense the cost of tax filing software for each state return, but I have to pay out of pocket at my current place which sucks.As the current world events have developed, many employers have required or allowed their employees to work remotely. It does cost me extra time and money to file a state return since I live in a state with no income tax. The taxes then get withheld and show up on my W-2 at the end of the year. I don’t work as a contractor but my current employer requires us to update our location in Workday whenever we work in another state. Professional athletes and touring musicians often hire accountants to deal with all of this, as they could end up working in more than a dozen states each year. Those contracting companies are supposed to track how many days are worked in each state, withhold and report taxes. They have exposure but at the end of the day, you as an employee still owe those taxes and the FTB could come after you too. A lot of companies do this because they know the FTB (California version of the IRS) is unlikely to go after them. Your HR (or really payroll) is ignoring the problem most likely. But you should bring this up to them.Ĭongress has been working on fixing some of this, but the bill hasn’t yet passed. Or they may know and just don’t do it (which is what a lot of people do). Your CPA may not even be totally aware if they don’t do work with other states. ![]() That’s how we found out this was even a thing even though he’s been traveling for work since 1999 and for this company since 2013! So my husband’s company, a major computing firm, is now making sure that happens. ![]() In recent years, states have more aggressively been coming after companies to make them withhold these taxes and employees to file as needed. We n practice, few people have ever kept track of this or paid those taxes. That includes “mobile” workers like my husband. It has been the case for a very long time that some states require state income taxes to be paid on the first day someone does work in that state. Ok, after doing some more looking, I think I have the details straight. Here, please treat others with respect, stay on-topic, and avoid self-promotion.Īlways do your own research before acting on any information or advice that you read on Reddit. Get your financial house in order, learn how to better manage your money, and invest for your future. Banking Megathread: FDIC, NCUA, and your cash.Private communication is not safe on Reddit. ![]() Scam alert: Ignore any private messages or chat requests.
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