If they earn income from sources outside of Puerto Rico, island residents are subject to federal income taxes. The IRS provides Spanish-language forms for these purposes, including Form 1040PR. This is simply the Spanish version of Form 1040SS, on which certain self-employed taxpayers living in U.S. territories report their income and the amount of self-employment tax they owe. Filing deadlines remain the same as for other citizens living on the mainland.
Get the Form
Search for "Form 1040PR" on the IRS website and navigate to the appropriate page. The form here are fillable, meaning you may complete it online and then print it out directly from the web. Alternatively, you may print the blank form and fill it out by hand. You may also get the form by requesting it directly from the IRS, which provides its forms free of charge on request. Remember the general IRS rule that if you are a resident Puerto Rico for the entire tax year, and you earn income only from Puerto Rico, you're not subject to federal income taxes.
Complete the top of the form with your name, address, and Social Security number, along with the name and Social Security number of your spouse. The IRS also requires you to identify your foreign country of residence, if applicable, as well as the province or state where you live and your postal code.
Filing Status and Self-Employment Tax
Complete Part I with information on your filing status and any children for whom you are claiming the additional child tax credit. Note that Form 1040PR is not the same as Form 1040. It's only used by those paying self-employment taxes and those who qualify for the additional child tax credit. In Part I, you also report self-employment tax as well as estimated tax payments and the amount of your additional child tax credit. At the end of this section, you calculate either an underpayment, for which you must submit a payment to the IRS, or an overpayment that entitles you to a refund.
Complete the Parts II through V. You will be declaring income and expenses from self-employment, whether it's through farming or a sole proprietorship. Part II is for Puerto Rico residents who are claiming the additional child tax credit. Part V is for the calculation of self-employment tax. Once this information is complete, sign and date the form at the bottom of the first page. Note that the use of 1040PR is not mandatory. If English is your first or preferred language you can substitute 1040SS.
Founder/president of the innovative reference publisher The Archive LLC, Tom Streissguth has been a self-employed business owner, independent bookseller and freelance author in the school/library market. Holding a bachelor's degree from Yale, Streissguth has published more than 100 works of history, biography, current affairs and geography for young readers.