Taxpayer was paid under her social security number but was actually operating as an S-Corp. Puerto Rico withheld taxes from her income. Does anybody know what form to file here? My software doesn't give PR as an option for the 1120-S, and the PR forms available cover self employment but not S-corps. I wrote the information office in San Juan over a month ago and have yet to receive a reply. Pub 570 does not say what forms need to be filed, just that I should file them (thanks, IRS!)
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It's late in the season, and I'd go with a Schedule C to make it easy for government matching and for the withholding in her SSN. That may not be what she intended, but she gave them her SSN and not her EIN, right? So, you report what actually happened. -
I have considered that
Thanks for the reply. I will likely go with the SCH-C but that still doesn't help me figure out which form to file with the commonwealth to get her withholding back! She isn't a bone fide resident so all the forms are to the IRS, not PR...Comment
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If a US citizen/resident and not a bona fide resident of Puerto Rico, they would file returns with both PR and US. A PR return showing only income from PR sources. A US tax return showing worldwide income with a foreign tax credit for taxes paid to PR. https://www.irs.gov/publications/p57...link1000221277
As far as completing the PR return, I'd pass it off to someone who regularly does that. It's not exactly a foreign country, but not far off. If someone wanted me to prepare a return for a foreign country I'd charge way more than it'd be worth to them because I'd have to learn everything about it. It also wouldn't be something I'd feel comfortable throwing together at the last minute. And there's going to be a lot of people in those countries/possessions that are already familiar with the tax system there.Comment
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And the winner is...
Thanks David, I have pawned it off to a preparer the taxpayer knows in PR. I think my nickname is "lucky"Comment
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