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2009 Taxes

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2009 Taxes

2009 taxes Index A Aircraft, Cars, Boats, and Aircraft Annuities, Annuities, Interests for Life or Terms of Years, Remainders, and Reversions Annuity contracts, Certain Life Insurance and Annuity Contracts Antiques, Paintings, Antiques, and Other Objects of Art Appraisals, Appraisals Cost of, Cost of appraisals. 2009 taxes IRS review of, Internal Revenue Service Review of Appraisals Qualified appraisal, Qualified Appraisal Appraiser, Qualified appraiser. 2009 taxes Art objects, Paintings, Antiques, and Other Objects of Art Valued at $20,000 or more, Art valued at $20,000 or more. 2009 taxes Valued at $50,000 or more, Art valued at $50,000 or more. 2009 taxes Assistance (see Tax help) B Boats, Cars, Boats, and Aircraft Bonds, Stocks and Bonds Books, Books. 2009 taxes Business, interest in, Interest in a Business C Cars, Cars, Boats, and Aircraft Clothing, used, Used Clothing, Deduction over $500 for certain clothing or household items. 2009 taxes Coins, Coin collections. 2009 taxes Collections, Collections Books, Books. 2009 taxes Coins, Coin collections. 2009 taxes Stamps, Stamp collections. 2009 taxes Comments on publication, Comments and suggestions. 2009 taxes Comparable properties, sales of, Sales of Comparable Properties, Selection of Comparable Sales Conservation contribution, Conservation purposes. 2009 taxes Cost, Cost or Selling Price of the Donated Property Rate of increase or decrease, Rate of increase or decrease in value. 2009 taxes Terms of purchase or sale, Terms of the purchase or sale. 2009 taxes D Date of contribution, Date of contribution. 2009 taxes Deductions of more than $5,000, Deductions of More Than $5,000 Deductions of more than $500,000, Deductions of More Than $500,000 F Fair market value, What Is Fair Market Value (FMV)? Comparable properties, sales of, Sales of Comparable Properties Cost, Cost or Selling Price of the Donated Property Date of contribution, Date of contribution. 2009 taxes Determining FMV, Determining Fair Market Value Opinions of experts, Opinions of Experts Problems in determining FMV, Problems in Determining Fair Market Value Replacement cost, Replacement Cost Form 8283, Form 8283 Formulas, use in valuing property, Determining Fair Market Value Free tax services, How To Get Tax Help Future events, effect on value, Future Events H Help (see Tax help) Historic building, Building in registered historic district. 2009 taxes Household goods, Household Goods, Deduction over $500 for certain clothing or household items. 2009 taxes I Interest in a business, Interest in a Business Inventory, Inventory IRS review of appraisals, Internal Revenue Service Review of Appraisals Exception, Exception. 2009 taxes J Jewelry and gems, Jewelry and Gems L Life insurance, Certain Life Insurance and Annuity Contracts M Market conditions, effect on value, Unusual Market Conditions More information (see Tax help) O Opinions of experts, Opinions of Experts P Paintings, Paintings, Antiques, and Other Objects of Art Partial interest, Partial Interest in Property Not in Trust Past events, effect on value, Using Past Events to Predict the Future Patents, Patents Penalties: Imposed on appraiser, Appraiser penalties. 2009 taxes Imposed on taxpayer, Penalty Publications (see Tax help) Publicly traded securities, Publicly traded securities. 2009 taxes Q Qualified appraisal, Qualified Appraisal Qualified appraiser, Qualified appraiser. 2009 taxes Qualified conservation contribution, Qualified Conservation Contribution R Real estate, Real Estate Remainder interests, Annuities, Interests for Life or Terms of Years, Remainders, and Reversions Replacement cost, Replacement Cost Reversion interests, Annuities, Interests for Life or Terms of Years, Remainders, and Reversions S Stamps, Stamp collections. 2009 taxes Statement of Value, Exception. 2009 taxes Stocks, Stocks and Bonds Suggestions for publication, Comments and suggestions. 2009 taxes T Tax help, How To Get Tax Help Taxpayer Advocate, Contacting your Taxpayer Advocate. 2009 taxes TTY/TDD information, How To Get Tax Help U Used clothing, Used Clothing, Deduction over $500 for certain clothing or household items. 2009 taxes V Valuation of property, Valuation of Various Kinds of Property Annuities, Annuities, Interests for Life or Terms of Years, Remainders, and Reversions Cars, boats, and aircraft, Cars, Boats, and Aircraft Collections, Collections Household goods, Household Goods Interest in a business, Interest in a Business Inventory, Inventory Jewelry and gems, Jewelry and Gems Life insurance and annuity contracts, Certain Life Insurance and Annuity Contracts Paintings, antiques, art objects, Paintings, Antiques, and Other Objects of Art Partial interest in property, Partial Interest in Property Not in Trust Real estate, Real Estate Remainder interests, Annuities, Interests for Life or Terms of Years, Remainders, and Reversions Reversion interests, Annuities, Interests for Life or Terms of Years, Remainders, and Reversions Stocks and bonds, Stocks and Bonds Terms of years, Annuities, Interests for Life or Terms of Years, Remainders, and Reversions Used clothing, Used Clothing Valuation of property: Patents, Patents Prev  Up     Home   More Online Publications
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The 2009 Taxes

2009 taxes 1. 2009 taxes   Bona Fide Residence Table of Contents Presence TestDays of Presence in the United States or Relevant Possession Significant Connection Tax HomeExceptions Closer ConnectionException for Year of Move Special Rules in the Year of a MoveYear of Moving to a Possession Year of Moving From a Possession Reporting a Change in Bona Fide ResidenceWho Must File Penalty for Not Filing Form 8898 In order to qualify for certain tax benefits (see chapter 3), you must be a bona fide resident of American Samoa, the CNMI, Guam, Puerto Rico, or the USVI for the entire tax year. 2009 taxes Generally, you are a bona fide resident of one of these possessions (the relevant possession) if, during the tax year, you: Meet the presence test, Do not have a tax home outside the relevant possession, and Do not have a closer connection to the United States or to a foreign country than to the relevant possession. 2009 taxes Special rule for members of the U. 2009 taxes S. 2009 taxes Armed Forces. 2009 taxes   If you are a member of the U. 2009 taxes S. 2009 taxes Armed Forces who qualified as a bona fide resident of the relevant possession in an earlier tax year, your absence from that possession during the current tax year in compliance with military orders will not affect your status as a bona fide resident. 2009 taxes Likewise, being in a possession solely in compliance with military orders will not qualify you for bona fide residency. 2009 taxes Also see the special income source rule for members of the U. 2009 taxes S. 2009 taxes Armed Forces in chapter 2, under Compensation for Labor or Personal Services . 2009 taxes Special rule for civilian spouse of active duty member of the U. 2009 taxes S. 2009 taxes Armed Forces. 2009 taxes   If you are the civilian spouse of an active duty servicemember, under Military Spouses Residency Relief Act (MSRRA) you can choose to keep your prior residence or domicile for tax purposes (tax residence) when accompanying the servicemember spouse, who is relocating under military orders, to a new military duty station in one of the 50 states, the District of Columbia, or a U. 2009 taxes S. 2009 taxes possession. 2009 taxes Before relocating, you and your spouse must have the same tax residence. 2009 taxes If you are a civilian spouse and choose to keep your prior tax residence after such relocation, the source of income for services performed (for example, wages, salaries, tips, or self-employment) by you is considered to be (the jurisdiction of) the prior tax residence. 2009 taxes As a result, the amount of income tax withholding (from Form(s) W-2, Wage and Tax Statement) that you are able to claim on your federal return, as well as the need to file a state or U. 2009 taxes S. 2009 taxes possession return, may be affected. 2009 taxes For more information, consult with state, local, or U. 2009 taxes S. 2009 taxes possession tax authorities regarding your tax obligations under MSRRA. 2009 taxes Presence Test If you are a U. 2009 taxes S. 2009 taxes citizen or resident alien, you will satisfy the presence test for the entire tax year if you meet one of the following conditions. 2009 taxes You were present in the relevant possession for at least 183 days during the tax year. 2009 taxes You were present in the relevant possession for at least 549 days during the 3-year period that includes the current tax year and the 2 immediately preceding tax years. 2009 taxes During each year of the 3-year period, you must be present in the relevant possession for at least 60 days. 2009 taxes You were present in the United States for no more than 90 days during the tax year. 2009 taxes You had earned income in the United States of no more than a total of $3,000 and were present for more days in the relevant possession than in the United States during the tax year. 2009 taxes Earned income is pay for personal services performed, such as wages, salaries, or professional fees. 2009 taxes You had no significant connection to the United States during the tax year. 2009 taxes Special rule for nonresident aliens. 2009 taxes   Conditions (1) through (5) above do not apply to nonresident aliens of the United States. 2009 taxes Instead, nonresident aliens must meet the substantial presence test discussed in chapter 1 of Publication 519. 2009 taxes In that discussion, substitute the name of the possession for “United States” and “U. 2009 taxes S. 2009 taxes ” wherever they appear. 2009 taxes Disregard the discussion in that chapter about a Closer Connection to a Foreign Country. 2009 taxes Days of Presence in the United States or Relevant Possession Generally, you are treated as being present in the United States or in the relevant possession on any day that you are physically present in that location at any time during the day. 2009 taxes Days of presence in a possession. 2009 taxes   You are considered to be present in the relevant possession on any of the following days. 2009 taxes Any day you are physically present in that possession at any time during the day. 2009 taxes Any day you are outside of the relevant possession in order to receive, or to accompany any of the following family members to receive, qualifying medical treatment (see Qualifying Medical Treatment , later). 2009 taxes Your parent. 2009 taxes Your spouse. 2009 taxes Your child, who is your son, daughter, stepson, or stepdaughter. 2009 taxes This includes an adopted child or child lawfully placed with you for legal adoption. 2009 taxes This also includes a foster child who is placed with you by an authorized placement agency or by judgment, decree, or other order of any court of competent jurisdiction. 2009 taxes Any day you are outside the relevant possession because you leave or are unable to return to the relevant possession during any: 14-day period within which a major disaster occurs in the relevant possession for which a Federal Emergency Management Agency (FEMA) notice of a federal declaration of a major disaster is issued in the Federal Register, or Period for which a mandatory evacuation order is in effect for the geographic area in the relevant possession in which your main home is located. 2009 taxes   If, during a single day, you are physically present: In the United States and in the relevant possession, that day is considered a day of presence in the relevant possession; or In two possessions, that day is considered a day of presence in the possession where your tax home is located (see Tax Home , later). 2009 taxes Days of presence in the United States. 2009 taxes   You are considered to be present in the United States on any day that you are physically present in the United States at any time during the day. 2009 taxes However, do not count the following days as days of presence in the United States. 2009 taxes Any day you are temporarily present in the United States in order to receive, or to accompany a parent, spouse, or child who is receiving, qualifying medical treatment. 2009 taxes “Child” is defined under item 2c earlier. 2009 taxes “Qualifying medical treatment” is defined later. 2009 taxes Any day you are temporarily present in the United States because you leave or are unable to return to the relevant possession during any: 14-day period within which a major disaster occurs in the relevant possession for which a Federal Emergency Management Agency (FEMA) notice of a federal declaration of a major disaster is issued in the Federal Register, or Period for which a mandatory evacuation order is in effect for the geographic area in the relevant possession in which your main home is located. 2009 taxes Any day you are in the United States for less than 24 hours when you are traveling between two places outside the United States. 2009 taxes Any day you are temporarily present in the United States as a professional athlete to compete in a charitable sports event (defined later). 2009 taxes Any day you are temporarily in the United States as a student (defined later). 2009 taxes Any day you are in the United States serving as an elected representative of the relevant possession, or serving full time as an elected or appointed official or employee of the government of that possession (or any of its political subdivisions). 2009 taxes Qualifying Medical Treatment Such treatment is generally provided by (or under the supervision of) a physician for an illness, injury, impairment, or physical or mental condition. 2009 taxes The treatment generally involves: Any period of inpatient care that requires an overnight stay in a hospital or hospice, and any period immediately before or after that inpatient care to the extent it is medically necessary, or Any temporary period of inpatient care in a residential medical care facility for medically necessary rehabilitation services. 2009 taxes With respect to each qualifying medical treatment, you must prepare (or obtain) and maintain documentation supporting your claim that such treatment meets the criteria to be considered days of presence in the relevant possession. 2009 taxes You must be able to produce this documentation within 30 days if requested by the IRS or tax administrator for the relevant possession. 2009 taxes You must keep the following documentation. 2009 taxes Records that provide: The patient's name and relationship to you (if the medical treatment is provided to a person you accompany); The name and address of the hospital, hospice, or residential medical care facility where the medical treatment was provided; The name, address, and telephone number of the physician who provided the medical treatment; The date(s) on which the medical treatment was provided; and Receipt(s) of payment for the medical treatment. 2009 taxes Signed certification by the providing or supervising physician that the medical treatment met the requirements for being qualified medical treatment, and setting forth: The patient's name, A reasonably detailed description of the medical treatment provided by (or under the supervision of) the physician, The dates on which the medical treatment was provided, and The medical facts that support the physician's certification and determination that the treatment was medically necessary. 2009 taxes Charitable Sports Event A charitable sports event is one that meets all of the following conditions. 2009 taxes The main purpose is to benefit a qualified charitable organization. 2009 taxes The entire net proceeds go to charity. 2009 taxes Volunteers perform substantially all the work. 2009 taxes In figuring the days of presence in the United States, you can exclude only the days on which you actually competed in the charitable sports event. 2009 taxes You cannot exclude the days on which you were in the United States to practice for the event, to perform promotional or other activities related to the event, or to travel between events. 2009 taxes Student To qualify as a student, you must be, during some part of each of any 5 calendar months during the calendar year: A full-time student at a school that has a regular teaching staff, course of study, and regularly enrolled body of students in attendance, or A student taking a full-time, on-farm training course given by a school described in (1) above or by a state, county, or local government agency. 2009 taxes The 5 calendar months do not have to be consecutive. 2009 taxes Full-time student. 2009 taxes   A full-time student is a person who is enrolled for the number of hours or courses the school considers to be full-time attendance. 2009 taxes However, school attendance exclusively at night is not considered full-time attendance. 2009 taxes School. 2009 taxes   The term “school” includes elementary schools, middle schools, junior and senior high schools, colleges, universities, and technical, trade, and mechanical schools. 2009 taxes It does not include on-the-job training courses, correspondence schools, and schools offering courses only through the Internet. 2009 taxes Significant Connection One way in which you can meet the presence test is to have no significant connection to the United States during the tax year. 2009 taxes This section looks at the factors that determine if a significant connection exists. 2009 taxes You are treated as having a significant connection to the United States if you: Have a permanent home in the United States, Are currently registered to vote in any political subdivision of the United States, or Have a spouse or child (see item 2c under Days of presence in a possession , earlier) who is under age 18 whose main home is in the United States, other than: A child who is in the United States because he or she is the child of divorced or legally separated parents and is living with a custodial parent under a custodial decree or multiple support agreement, or A child who is in the United States as a student. 2009 taxes For the purpose of determining if you have a significant connection to the United States, the term “spouse” does not include a spouse from whom you are legally separated under a decree of divorce or separate maintenance. 2009 taxes Permanent home. 2009 taxes   A permanent home generally includes an accommodation such as a house, an apartment, or a furnished room that is either owned or rented by you or your spouse. 2009 taxes The dwelling unit must be available at all times, continuously, not only for short stays. 2009 taxes Exception for rental property. 2009 taxes   If you or your spouse own the dwelling unit and at any time during the tax year it is rented to someone else at fair rental value, it will be considered your permanent home only if you or your spouse use that property for personal purposes for more than the greater of: 14 days, or 10% of the number of days during that tax year that the property is rented to others at a fair rental value. 2009 taxes   You are treated as using rental property for personal purposes on any day the property is not being rented to someone else at fair rental value for the entire day. 2009 taxes   A day of personal use of a dwelling unit is also any day that the unit is used by any of the following persons. 2009 taxes You or any other person who has an interest in it, unless you rent it to another owner as his or her main home under a shared equity financing agreement. 2009 taxes A member of your family or a member of the family of any other person who has an interest in it, unless the family member uses the dwelling unit as his or her main home and pays a fair rental price. 2009 taxes Family includes only brothers and sisters, half-brothers and half-sisters, spouses, ancestors (parents, grandparents, etc. 2009 taxes ), and lineal descendants (children, grandchildren, etc. 2009 taxes ). 2009 taxes Anyone under an arrangement that lets you use some other dwelling unit. 2009 taxes Anyone at less than a fair rental price. 2009 taxes   However, any day you spend working substantially full time repairing and maintaining (not improving) your property is not counted as a day of personal use. 2009 taxes Whether your property is used mainly for this purpose is determined in light of all the facts and circumstances, such as: The amount of time you devote to repair and maintenance work, How often during the tax year you perform repair and maintenance work on this property, and The presence and activities of companions. 2009 taxes   See Publication 527, Residential Rental Property, for more information about personal use of a dwelling unit. 2009 taxes Example—significant connection. 2009 taxes Ann Green, a U. 2009 taxes S. 2009 taxes citizen, is a sales representative for a company based in Guam. 2009 taxes Ann lives with her spouse and young children in their house in Guam, where she is also registered to vote. 2009 taxes Her business travel requires her to spend 120 days in the United States and another 120 days in foreign countries. 2009 taxes When traveling on business, Ann generally stays at hotels but sometimes stays with her brother, who lives in the United States. 2009 taxes Ann's stays are always of short duration and she asks her brother's permission to stay with him. 2009 taxes Her brother's house is not her permanent home, nor does she have any other accommodations in the United States that would be considered her permanent home. 2009 taxes Ann satisfies the presence test because she has no significant connection to the United States. 2009 taxes Example—presence test. 2009 taxes Eric and Wanda Brown live for part of the year in a condominium, which they own, in the CNMI. 2009 taxes They also own a house in Maine where they live for 120 days every year to be near their grown children and grandchildren. 2009 taxes The Browns are retired and their only income is from pension payments, dividends, interest, and social security benefits. 2009 taxes In 2013, they spent only 175 days in the CNMI because of a 70-day vacation to Europe and Asia. 2009 taxes Thus, in 2013, the Browns were not present in the CNMI for at least 183 days, were present in the United States for more than 90 days, and had a significant connection to the United States because of their permanent home. 2009 taxes However, the Browns still satisfied the presence test with respect to the CNMI because they had no earned income in the United States and were physically present for more days in the CNMI than in the United States. 2009 taxes Tax Home You will have met the tax home test if you did not have a tax home outside the relevant possession during any part of the tax year. 2009 taxes Your tax home is your regular or main place of business, employment, or post of duty regardless of where you maintain your family home. 2009 taxes If you do not have a regular or main place of business because of the nature of your work, then your tax home is the place where you regularly live. 2009 taxes If you do not fit either of these categories, you are considered an itinerant and your tax home is wherever you work. 2009 taxes Exceptions There are some special rules regarding tax home that provide exceptions to the general rule stated above. 2009 taxes Students and Government Officials Disregard the following days when determining whether you have a tax home outside the relevant possession. 2009 taxes Days you were temporarily in the United States as a student (see Student under Days of Presence in the United States or Relevant Possession, earlier). 2009 taxes Days you were in the United States serving as an elected representative of the relevant possession, or serving full time as an elected or appointed official or employee of the government of that possession (or any of its political subdivisions). 2009 taxes Seafarers You will not be considered to have a tax home outside the relevant possession solely because you are employed on a ship or other seafaring vessel that is predominantly used in local and international waters. 2009 taxes For this purpose, a vessel is considered to be predominantly used in local and international waters if, during the tax year, the total amount of time it is used in international waters and in the waters within 3 miles of the relevant possession exceeds the total amount of time it is used in the territorial waters of the United States, another possession, or any foreign country. 2009 taxes Example. 2009 taxes In 2013, Sean Silverman, a U. 2009 taxes S. 2009 taxes citizen, was employed by a fishery and spent 250 days at sea on a fishing vessel. 2009 taxes When not at sea, Sean lived with his spouse at a house they own in American Samoa. 2009 taxes The fishing vessel on which Sean works departs and arrives at various ports in American Samoa, other possessions, and foreign countries, but was in international or American Samoa's local waters for 225 days. 2009 taxes For purposes of determining bona fide residency of American Samoa, Sean will not be considered to have a tax home outside that possession solely because of his employment on board the fishing vessel. 2009 taxes Year of Move If you are moving to or from a possession during the year, you may still be able to meet the tax home test for that year. 2009 taxes See Special Rules in the Year of a Move , later in this chapter. 2009 taxes Closer Connection You will have met the closer connection test if, during any part of the tax year, you do not have a closer connection to the United States or a foreign country than to the relevant U. 2009 taxes S. 2009 taxes possession. 2009 taxes You will be considered to have a closer connection to a possession than to the United States or to a foreign country if you have maintained more significant contacts with the possession(s) than with the United States or foreign country. 2009 taxes In determining if you have maintained more significant contacts with the relevant possession, the facts and circumstances to be considered include, but are not limited to, the following. 2009 taxes The location of your permanent home. 2009 taxes The location of your family. 2009 taxes The location of personal belongings, such as automobiles, furniture, clothing, and jewelry owned by you and your family. 2009 taxes The location of social, political, cultural, professional, or religious organizations with which you have a current relationship. 2009 taxes The location where you conduct your routine personal banking activities. 2009 taxes The location where you conduct business activities (other than those that go into determining your tax home). 2009 taxes The location of the jurisdiction in which you hold a driver's license. 2009 taxes The location of the jurisdiction in which you vote. 2009 taxes The location of charitable organizations to which you contribute. 2009 taxes The country of residence you designate on forms and documents. 2009 taxes The types of official forms and documents you file, such as Form W-8BEN, Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting (Individuals), or Form W-9, Request for Taxpayer Identification Number and Certification. 2009 taxes Your connections to the relevant possession will be compared to the total of your connections with the United States and foreign countries. 2009 taxes Your answers to the questions on Form 8898, Part III, will help establish the jurisdiction to which you have a closer connection. 2009 taxes Example—closer connection to the United States. 2009 taxes Marcos Reyes, a U. 2009 taxes S. 2009 taxes citizen, moved to Puerto Rico in 2013 to start an investment consulting and venture capital business. 2009 taxes His spouse and two teenage children remained in California to allow the children to complete high school. 2009 taxes He traveled back to the United States regularly to see his spouse and children, to engage in business activities, and to take vacations. 2009 taxes Marcos had an apartment available for his full-time use in Puerto Rico, but remained a joint owner of the residence in California where his spouse and children lived. 2009 taxes Marcos and his family had automobiles and personal belongings such as furniture, clothing, and jewelry located at both residences. 2009 taxes Although Marcos was a member of the Puerto Rico Chamber of Commerce, he also belonged to and had current relationships with social, political, cultural, and religious organizations in California. 2009 taxes Marcos received mail in California, including bank and brokerage statements and credit card bills. 2009 taxes He conducted his personal banking activities in California. 2009 taxes He held a California driver's license and was also registered to vote there. 2009 taxes Based on all of the particular facts and circumstances pertaining to Marcos, he was not a bona fide resident of Puerto Rico in 2013 because he had a closer connection to the United States than to Puerto Rico. 2009 taxes Closer connection to another possession. 2009 taxes   Generally, possessions are not treated as foreign countries. 2009 taxes Therefore, a closer connection to a possession other than the relevant possession will not be treated as a closer connection to a foreign country. 2009 taxes Example—tax home and closer connection to possession. 2009 taxes Pearl Blackmon, a U. 2009 taxes S. 2009 taxes citizen, is a permanent employee of a hotel in Guam, but works only during the tourist season. 2009 taxes For the remainder of each year, Pearl lives with her spouse and children in the CNMI, where she has no outside employment. 2009 taxes Most of Pearl's personal belongings, including her automobile, are located in the CNMI. 2009 taxes She is registered to vote in, and has a driver's license issued by, the CNMI. 2009 taxes She does her personal banking in the CNMI and routinely lists her CNMI address as her permanent address on forms and documents. 2009 taxes Pearl satisfies the presence test with respect to both Guam and the CNMI. 2009 taxes She satisfies the tax home test with respect to Guam, because her regular place of business is in Guam. 2009 taxes Pearl satisfies the closer connection test with respect to both Guam and the CNMI, because she does not have a closer connection to the United States or to any foreign country. 2009 taxes Pearl is considered a bona fide resident of Guam, the location of her tax home. 2009 taxes Exception for Year of Move If you are moving to or from a possession during the year, you may still be able to meet the closer connection test for that year. 2009 taxes See Special Rules in the Year of a Move , next. 2009 taxes Special Rules in the Year of a Move If you are moving to or from a possession during the year, you may still be able to meet the tax home and closer connection tests for that year. 2009 taxes Year of Moving to a Possession You will satisfy the tax home and closer connection tests in the tax year of changing your residence to the relevant possession if you meet all of the following. 2009 taxes You have not been a bona fide resident of the relevant possession in any of the 3 tax years immediately preceding your move. 2009 taxes In the year of the move, you do not have a tax home outside the relevant possession or a closer connection to the United States or a foreign country than to the relevant possession during any of the last 183 days of the tax year. 2009 taxes You are a bona fide resident of the relevant possession for each of the 3 tax years immediately following your move. 2009 taxes Example. 2009 taxes Dwight Wood, a U. 2009 taxes S. 2009 taxes citizen, files returns on a calendar year basis. 2009 taxes He lived in the United States from January 2007 through May 2013. 2009 taxes In June 2013 he moved to the USVI, purchased a house, and accepted a permanent job with a local employer. 2009 taxes From July 1 through December 31, 2013 (more than 183 days), Dwight's principal place of business was in the USVI and, during that time, he did not have a closer connection to the United States or a foreign country than to the USVI. 2009 taxes If he is a bona fide resident of the USVI during all of 2014 through 2016, he will satisfy the tax home and closer connection tests for 2013. 2009 taxes If Dwight also satisfies the presence test in 2013, he will be considered a bona fide resident of the USVI for the entire 2013 tax year. 2009 taxes Year of Moving From a Possession In the year you cease to be a bona fide resident of American Samoa, the CNMI, Guam, or the USVI, you will satisfy the tax home and closer connection tests with respect to the relevant possession if you meet all of the following. 2009 taxes You have been a bona fide resident of the relevant possession for each of the 3 tax years immediately preceding your change of residence. 2009 taxes In the year of the move, you do not have a tax home outside the relevant possession or a closer connection to the United States or a foreign country than to the relevant possession during any of the first 183 days of the tax year. 2009 taxes You are not a bona fide resident of the relevant possession for any of the 3 tax years immediately following your move. 2009 taxes Example. 2009 taxes Jean Aspen, a U. 2009 taxes S. 2009 taxes citizen, files returns on a calendar year basis. 2009 taxes From January 2010 through December 2012, Jean was a bona fide resident of American Samoa. 2009 taxes Jean continued to live there until September 6, 2013, when she accepted new employment and moved to Hawaii. 2009 taxes Jean's principal place of business from January 1 through September 5, 2013 (more than 183 days), was in American Samoa, and during that period Jean did not have a closer connection to the United States or a foreign country than to American Samoa. 2009 taxes If Jean continues to live and work in Hawaii for the rest of 2013 and throughout years 2014 through 2016, she will satisfy the tax home and closer connection tests for 2013 with respect to American Samoa. 2009 taxes If Jean also satisfies the presence test in 2013, she will be considered a bona fide resident for the entire 2013 tax year. 2009 taxes Puerto Rico You will be considered a bona fide resident of Puerto Rico for the part of the tax year preceding the date on which you move if you: Are a U. 2009 taxes S. 2009 taxes citizen, Are a bona fide resident of Puerto Rico for at least 2 tax years immediately preceding the tax year of the move, Cease to be a bona fide resident of Puerto Rico during the tax year, Cease to have a tax home in Puerto Rico during the tax year, and Have a closer connection to Puerto Rico than to the United States or a foreign country throughout the part of the tax year preceding the date on which you cease to have a tax home in Puerto Rico. 2009 taxes Example. 2009 taxes Randy White, a U. 2009 taxes S. 2009 taxes citizen, files returns on a calendar year basis. 2009 taxes For all of 2011 and 2012, Randy was a bona fide resident of Puerto Rico. 2009 taxes From January through April 2013, Randy continued to reside and maintain his principal place of business in and closer connection to Puerto Rico. 2009 taxes On May 5, 2013, Randy moved and changed his tax home to Nevada. 2009 taxes Later that year he established a closer connection to the United States than to Puerto Rico. 2009 taxes Randy did not satisfy the presence test for 2013 with respect to Puerto Rico, nor the tax home or closer connection tests. 2009 taxes However, because Randy was a bona fide resident of Puerto Rico for at least 2 tax years before he moved to Nevada in 2013, he was a bona fide resident of Puerto Rico from January 1 through May 4, 2013. 2009 taxes Reporting a Change in Bona Fide Residence If you became or ceased to be a bona fide resident of a U. 2009 taxes S. 2009 taxes possession, you may need to file Form 8898. 2009 taxes This applies to the U. 2009 taxes S. 2009 taxes possessions of American Samoa, the CNMI, Guam, Puerto Rico, and the USVI. 2009 taxes Who Must File You must file Form 8898 for the tax year in which you meet both of the following conditions. 2009 taxes Your worldwide gross income (defined below) in that tax year is more than $75,000. 2009 taxes You meet one of the following. 2009 taxes You take a position for U. 2009 taxes S. 2009 taxes tax purposes that you became a bona fide resident of a U. 2009 taxes S. 2009 taxes possession after a tax year for which you filed a U. 2009 taxes S. 2009 taxes income tax return as a citizen or resident alien of the United States but not as a bona fide resident of the possession. 2009 taxes You are a citizen or resident alien of the United States who takes the position for U. 2009 taxes S. 2009 taxes tax purposes that you ceased to be a bona fide resident of a U. 2009 taxes S. 2009 taxes possession after a tax year for which you filed an income tax return (with the IRS, the possession tax authority, or both) as a bona fide resident of the possession. 2009 taxes You take the position for U. 2009 taxes S. 2009 taxes tax purposes that you became a bona fide resident of Puerto Rico or American Samoa after a tax year for which you were required to file an income tax return as a bona fide resident of the CNMI, Guam, or the USVI. 2009 taxes Worldwide gross income. 2009 taxes   Worldwide gross income means all income you received in the form of money, goods, property, and services, including any income from sources outside the United States (even if you can exclude part or all of it) and before any deductions, credits, or rebates. 2009 taxes Example. 2009 taxes You are a U. 2009 taxes S. 2009 taxes citizen who moved to the CNMI in December 2012, but did not become a bona fide resident of that possession until the 2013 tax year. 2009 taxes You must file Form 8898 for the 2013 tax year if your worldwide gross income for that year was more than $75,000. 2009 taxes Penalty for Not Filing Form 8898 If you are required to file Form 8898 for any tax year and you fail to file it, you may owe a penalty of $1,000. 2009 taxes You may also owe this penalty if you do not include all the information required by the form or the form includes incorrect information. 2009 taxes In either case, you will not owe this penalty if you can show that such failure is due to reasonable cause and not willful neglect. 2009 taxes This is in addition to any criminal penalty that may be imposed. 2009 taxes Prev  Up  Next   Home   More Online Publications