Posted on 01/29/2008 6:34:03 AM PST by cll
I haven't heard a peep about this here, so here it goes.
In all probability, Puerto Rico residents (I'm not sure about the other territories) will be included in the tax rebates that are part of the proposed federal stimulus package.
Puerto Rico workers and employers pay Social Security, Medicare and Unemployment taxes but no federal income tax.
Island residents would get their rebates at the same levels as the residents of the 50 states.
The funniest part is that the notoriously corrupt current island administration is lobbying hard, and apparently is succeeding, in getting Congress to send them the money in bulk, instead of directly to Social Security and Medicare taxpayers, so they can dish it out during this election year.
The not so funny part is the island's Treasury Department's penchant for withholding taxpayers refunds for every little detail, and for confiscating taxpayers bank accounts over bogus debts.
The story behind the story is that the island government has not been able to balance its budget for the last seven years, and the governor is salivating over this $1 billion bonanza.
Even if I would purportedly benefit from this rebate, this smells fishy to me and I think it is important that this gets out there. Especially the part about the island government getting the money in bulk, again, instead of directly to the Social Security and Medicare taxpayers.
With half of Puerto Rico residents in Florida and NY will they still get money in both the States and District? Smells a little fishy to me too.
Good question. Probably true, and most likely, orchestrated by Campaign Klintoon........
“Probably true”
Oh, it is true. They’re not talking about anything else in the news down here on the island.
In fact, Congressman Serrano (D-NY), is asking Puerto Rico politicians to keep this hushed so as to not steer too much controversy in D.C. and the rest of the nation.
The wanting to keep this hushed part is what really disturbs me.
The residents of the two commonwealths and three unincorporated territories pay federal income tax. The tax receipts are then transfered to the commonwealth or territorial government.
The residents of those territories do have to file and pay federal income tax. Technically as those territories are US possessions all taxes paid there are federal taxes, even those imposed locally.
Two of them (Guam and the US Virgin Islands) are governed by Organic Acts passed by the Congress.
Two of them (Puerto Rico and the Northern Mariana Islands) have Constitutions and Free Association agreements approved by the Congress.
And the the fifth, American Samoa, is governed by a constitution approved by the Department of the Interior.
A Puerto Rican in New York or Florida is not a Puerto Rican for tax purposes he is a New Yorker or Floridian.
There is a difference between Puerto Rican ethnicity (having a family or ancesteral relationship to the island) and Puerto Rican or state residency (where you live and pay taxes).
“The residents of the two commonwealths and three unincorporated territories pay federal income tax. The tax receipts are then transfered to the commonwealth or territorial government.”
I think that is true for the USVI, but I’m sure it is not true for Puerto Rico. I live there (here). Most people and employers pay only Federal Social Security, Medicare and Unemployment taxes. Very few people and corporations pay any federal income taxes.
You don’t file at all? I know that PR is poorer than the 50 states, so less people will pay. And I know there are exemptions for industry in the Commonwealth, but I thought that the population had to file like anybody else.
If you are born in Puerto Rico, and live and file in New York, then you are a New Yorker, period. Puerto Rico would not be involved in the issue at all.
If you are born in Illinois, and live Puerto Rico, then you are a Puerto Rican, period. Illinois would not be involved in the issue at all.
Only if you have federal income like military pay or federal civil service pay, or if you have interest or investment income from financial institutions outside of Puerto Rico, or if you have other than Puerto Rico-sourced income.
For example, I retired from a military reserve component in 2005. Up until then I had to file my 1040 every year. From 2006 on, I only file my local tax returns. When I start getting my military pension, I will then have to file 1040’s again.
But if you’re a Bona Fide Puerto Rico resident and have only Puerto Rico-source income, you don’t even have to talk to the IRS. Ever.
Rush,Sean,Boortz,O’Really and Savage should be all over this!.......
I’ll float it...Ping!
No income taxes no rebates. That should be the rule.
Write to your Congressman. Thanks.
Under Section 933 of the U.S. Internal Revenue Code, bona fide residents of Puerto Rico are exempt from federal income taxation for their Puerto Rico-source income. That means that residents of Puerto Rico that do not have U.S.-source income (or that receive a de minimus amount of U.S.-source income, since, e.g., dividends paid by U.S.-domiciled companies is U.S.-source income but one wouldn’t need to file a return for receiving $100 in dividend payments) do not need to pay federal income taxes or file a federal tax return. Only those with U.S.-source income (which includes employees of the federal government) have to file a federal tax return.
If I’m not mistaken, the U.S. Virgin Islands has a local income tax that is collected by the IRS and then returned to the USVI treasury. However, this is not the same as saying that residents of the USVI pay federal taxes.
BTW, residents of U.S. territories do pay federal payroll taxes (Social Security and Medicare). If residents of U.S. territories receive the same federal rebate as that received by mainland residents that do not pay federal income taxes but pay payroll taxes (which, IIRC, is half the amount of the rebate for those who pay federal income taxes), then I don’t see what the problem is. Congress should make sure that the amount is mailed directly to the taxpayers and is not sent to the territorial government for its distribution.
I’ve sent this link to a local radio talk show host here in Washington, DC who wrote back and asked if there’s a source or a link to any article that would discuss this.
Do you know of a source on this, cll?
Only in Spanish. I’ve Googled the news several times today and there’s nothing on this yet.
Again, it’s all they’re talking about in the local talkshows today.
El Nuevo Dia? Vocero? Primera Hora?
Anything linkable?
“In fact, Congressman Serrano (D-NY), is asking Puerto Rico politicians to keep this hushed so as to not steer too much controversy in D.C. and the rest of the nation.”
How do you know this? Was this on Puerto Rican TV or radio?
Thanks for the links!
From his own lips during a radio interview with Carmen Jovet yesterday.
Holy cow! I’m assuming that the Jovet interview is in Spanish... any links to that radio show? Do they carry it ‘on demand’ for podacsts or something like that?
More alarmingly is the fact that Carmen Jovet is still on-air...
She still think she’s in her 20’s.
She’s on NotiUno (formerly Radio Uno) from 10:00 AM to 12:00 N AST. They do have podcasts. http://www.notiuno.com
Thanks so much, cll! I need to send this link around to interested parties. Was Congressman Serrano on yesterday’s show - Monday, 1/28?
Yes, Monday 1/28/08. The money quote was repeated on today’s show.
Just what Puerto Rico needs; more ammunition for anti-Puerto Ricans to denounce the island. In all fairness, if you don’t pay federal income tax, you shouldn’t get a rebate.
“In all fairness, if you don’t pay federal income tax, you shouldn’t get a rebate”
I agree but my whole problem with this is that Congress got suckered by the island government into giving the money to them to distribute instead of giving it directly to those who do pay some form of tax or the other.
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