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raggamuffin74
New Member

I work from home in California for a company based in the US Virgin Islands. I received a W-2VI. Do I enter this as a W2?

 
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DS30
New Member

I work from home in California for a company based in the US Virgin Islands. I received a W-2VI. Do I enter this as a W2?

Yes, you would report the W-2VI just like a W-2 except do NOT report Box 2 amount as federal withholdings (you will need to do some additional allocations related to your VI income).

TurboTax does not support this type of tax filing.

Since the amount listed on your W-2VI in box 2 is VI income tax withheld instead of US federal income tax withholdings, do not report this information when inputting your W-2VI. The taxes paid to the U.S. Virgin Islands are not deductible on either a Federal or U.S. Virgin Islands return. Instead, these taxes paid to the U.S. Virgin Islands are a refundable credit on the Federal or U.S. Virgin Islands return. Also, do not put the VI income tax withheld shown in Box 2 as Box 17 state income tax withholdings.

Since you do not qualify as a “bona fide resident” of the U.S. Virgin Islands, you will need to do the following in order to file your Form 1040.

You will need to split your tax due between the United States and the U.S. Virgin Islands. Get a copy of Form 8689 Allocation of Individual Income Tax to the U.S. Virgin Islands from the IRS website. http://www.irs.gov/pub/irs-pdf/f8689.pdf. This form is not supported by TurboTax.

Fill out Parts I and II with the amounts from the Virgin Islands only that you identified when collecting your information. Do the calculation in Part III. This is the portion of your total tax that is paid to the U.S. Virgin Islands. Finish Form 8689 Part IV using amounts paid to the U.S. Virgin Islands. Ignore line 40. You now need two “identical” tax returns.

Credit for U.S. tax paid to the USVI. You can take a credit on your U.S. return for the U.S. tax allocated to the USVI only if you actually paid the tax to the USVI. To take the credit, you must complete Form 8689 and attach it to your Form 1040. Add line 40 and line 45 of Form 8689 and include the amount in the total on Form 1040, line 74. On the dotted line next to line 74, enter "Form 8689" and the amount paid.

On the Form 1040 that will go to the IRS, put the amount from Form 8689 line 35 on Form 1040 line 53 c “8689”. Calculate your total payments to the IRS, Federal income tax withheld from Forms W-2, etc., and fill out Form 1040 lines 61 through 76 using Federal amounts. Place Form 8689 in the return in attachment sequence order (85). Sign and date Form 1040 on page 2 and mail to the IRS Service Center Austin, TX 73301-0215.

If you are including a check or money order, file your original return with the Internal Revenue Service, P.O. Box 1303, Charlotte, NC 28201-1303 USA.

On the Form 1040 that will be filed with the Virgin Islands Bureau of Internal Revenue, put Form 8689 as the first page of the return (on top of Form 1040 page 1). Ignore Form 8689 instructions to put amounts from lines 40 (which should be blank) and 44 on Form 1040 line 71. (We are giving you the official V.I. Bureau of Internal Revenue instructions.) Sign and date the return.

File a signed copy of your Form 1040 (with all attachments, forms, and schedules, including Form 8689) with the Virgin Islands Bureau of Internal Revenue, 6115 Estate Smith Bay, St. Thomas, VI 00802. They will accept a signed copy of your U.S. return and process it as an original return.

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3 Replies
Carl
Level 15

I work from home in California for a company based in the US Virgin Islands. I received a W-2VI. Do I enter this as a W2?

No, you don't. The W-2VI does not indicate any U.S. Federal Taxes withheld. Only Virgin Island Taxes. I've flagged this post for TurboTax to see, so hopefully we can both learn the correct way to report a W-2VI, with the program - if it's even possible.
DS30
New Member

I work from home in California for a company based in the US Virgin Islands. I received a W-2VI. Do I enter this as a W2?

Yes, you would report the W-2VI just like a W-2 except do NOT report Box 2 amount as federal withholdings (you will need to do some additional allocations related to your VI income).

TurboTax does not support this type of tax filing.

Since the amount listed on your W-2VI in box 2 is VI income tax withheld instead of US federal income tax withholdings, do not report this information when inputting your W-2VI. The taxes paid to the U.S. Virgin Islands are not deductible on either a Federal or U.S. Virgin Islands return. Instead, these taxes paid to the U.S. Virgin Islands are a refundable credit on the Federal or U.S. Virgin Islands return. Also, do not put the VI income tax withheld shown in Box 2 as Box 17 state income tax withholdings.

Since you do not qualify as a “bona fide resident” of the U.S. Virgin Islands, you will need to do the following in order to file your Form 1040.

You will need to split your tax due between the United States and the U.S. Virgin Islands. Get a copy of Form 8689 Allocation of Individual Income Tax to the U.S. Virgin Islands from the IRS website. http://www.irs.gov/pub/irs-pdf/f8689.pdf. This form is not supported by TurboTax.

Fill out Parts I and II with the amounts from the Virgin Islands only that you identified when collecting your information. Do the calculation in Part III. This is the portion of your total tax that is paid to the U.S. Virgin Islands. Finish Form 8689 Part IV using amounts paid to the U.S. Virgin Islands. Ignore line 40. You now need two “identical” tax returns.

Credit for U.S. tax paid to the USVI. You can take a credit on your U.S. return for the U.S. tax allocated to the USVI only if you actually paid the tax to the USVI. To take the credit, you must complete Form 8689 and attach it to your Form 1040. Add line 40 and line 45 of Form 8689 and include the amount in the total on Form 1040, line 74. On the dotted line next to line 74, enter "Form 8689" and the amount paid.

On the Form 1040 that will go to the IRS, put the amount from Form 8689 line 35 on Form 1040 line 53 c “8689”. Calculate your total payments to the IRS, Federal income tax withheld from Forms W-2, etc., and fill out Form 1040 lines 61 through 76 using Federal amounts. Place Form 8689 in the return in attachment sequence order (85). Sign and date Form 1040 on page 2 and mail to the IRS Service Center Austin, TX 73301-0215.

If you are including a check or money order, file your original return with the Internal Revenue Service, P.O. Box 1303, Charlotte, NC 28201-1303 USA.

On the Form 1040 that will be filed with the Virgin Islands Bureau of Internal Revenue, put Form 8689 as the first page of the return (on top of Form 1040 page 1). Ignore Form 8689 instructions to put amounts from lines 40 (which should be blank) and 44 on Form 1040 line 71. (We are giving you the official V.I. Bureau of Internal Revenue instructions.) Sign and date the return.

File a signed copy of your Form 1040 (with all attachments, forms, and schedules, including Form 8689) with the Virgin Islands Bureau of Internal Revenue, 6115 Estate Smith Bay, St. Thomas, VI 00802. They will accept a signed copy of your U.S. return and process it as an original return.

dkassar91908
New Member

I work from home in California for a company based in the US Virgin Islands. I received a W-2VI. Do I enter this as a W2?

Thank you so much!
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