Form 5074 Allocation of Individual Income Tax To Guam or the Commo

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Form

5074

Allocation of Individual Income Tax to Guam or the
Commonwealth of the Northern Mariana Islands (CNMI)

Department of the Treasury
Internal Revenue Service

▶

Go to www.irs.gov/Form5074 for the latest information.
▶ Attach to Form 1040 or 1040-SR.

Your social security number

DRAFT AS OF
June 14, 2019
DO NOT FILE

Income From Guam or the CNMI Reported on Form 1040, 1040-SR, or Schedule 1 (Form 1040 or 1040-SR),
Part I
Guam

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Wages, salaries, tips, etc. . . . . . . . . . . . . . . . .
Taxable interest . . . . . . . . . . . . . . . . . . .
Ordinary dividends . . . . . . . . . . . . . . . . . .
Taxable refunds, credits, or offsets of local Guam or CNMI income taxes
Alimony received . . . . . . . . . . . . . . . . . . .
Business income or (loss) . . . . . . . . . . . . . . . .
Capital gain or (loss) . . . . . . . . . . . . . . . . . .
Other gains or (losses) . . . . . . . . . . . . . . . . .
IRA distributions (taxable amount) . . . . . . . . . . . . .
Pensions and annuities (taxable amount) . . . . . . . . . . .
Rental real estate, royalties, partnerships, S corporations, trusts, etc. . .
Farm income or (loss) . . . . . . . . . . . . . . . . .
Unemployment compensation . . . . . . . . . . . . . .
Social security benefits (taxable amount) . . . . . . . . . . .
Other income. List type and amount ▶
Total income. Add lines 1 through 15 . . . . . . . . . . . .

Part II

2019

Attachment
Sequence No. 168

Name(s) shown on Form 1040 or 1040-SR

Part I

OMB No. 1545-0074

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Adjustments to Income From Guam or the CNMI Reported on Schedule 1 (Form 1040 or 1040-SR),
Part II

17 Educator expenses . . . . . . . . . . . . . . . . . . . . . .
18 Certain business expenses of reservists, performing artists, and fee-basis government
officials . . . . . . . . . . . . . . . . . . . . . . . . . .
19 Health savings account deduction . . . . . . . . . . . . . . . . .
20 Moving expenses for members of the armed forces . . . . . . . . . . .
21 Deductible part of self-employment tax
. . . . . . . . . . . . . . .
22 Self-employed SEP, SIMPLE, and qualified plans . . . . . . . . . . . .
23 Self-employed health insurance deduction . . . . . . . . . . . . . .
24 Penalty on early withdrawal of savings . . . . . . . . . . . . . . . .
25 IRA deduction . . . . . . . . . . . . . . . . . . . . . . . .
26 Student loan interest deduction . . . . . . . . . . . . . . . . . .
27 Reserved for future use. See instructions . . . . . . . . . . . . . . .
28 Add lines 17 through 27 . . . . . . . . . . . . . . . . . . . . .
29 Adjusted gross income. Subtract line 28 from line 16 . . . . . . . . . ▶

Part III

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Payments of Income Tax to Guam or the CNMI

30 Payments on estimated tax return filed with Guam or the CNMI
. . . . . . .
31 Income tax withheld from your wages while employed by the U.S. Government as a
civilian in Guam or the CNMI . . . . . . . . . . . . . . . . . . .
32 Income tax withheld from your wages while employed as a member of the
U.S. Armed Forces in Guam or the CNMI . . . . . . . . . . . . . . .
33 Income tax withheld from your wages earned in Guam or the CNMI other than
amounts on lines 30 through 32 . . . . . . . . . . . . . . . . . .
34 Total payments. Add lines 30 through 33 . . . . . . . . . . . . . . ▶
Section references are to the Internal Revenue Code unless otherwise
noted.
At the time this form and instructions went to print, the
tuition and fees deduction had expired. To see if this
deduction has been extended so you can claim it on your
CAUTION 2019 return, go to www.irs.gov/FormsUpdates.

!
▲

CNMI

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Instructions
Purpose of form. Form 5074 provides information to the United States
so the IRS can figure the individual income tax that is due to Guam or
the CNMI.
Who must file. If you were a U.S. citizen or resident alien (other than a
bona fide resident of Guam or the CNMI), you may need to file Form
5074. Complete this form if all of the following apply to you (and to your
spouse if filing a joint return).

For Paperwork Reduction Act Notice, see the Instructions for Forms 1040 and 1040-SR.

Cat. No. 42243X

Form 5074 (2019)

Page 2

Form 5074 (2019)

• You file a U.S. income tax return.
• You report adjusted gross income (AGI) of $50,000 or more.
• At least $5,000 of the gross income on your return is from either Guam
or CNMI sources.
Do not use this form if you were a bona fide resident of
Guam or the CNMI during the entire tax year, or were
considered a bona fide resident of Guam or the CNMI for the
CAUTION entire tax year under the special rules for the year of a move
(see chapter 1 of Pub. 570, Tax Guide for Individuals With
Income From U.S. Possessions).
Joint returns. If you file jointly and only one spouse is a bona fide
resident of Guam or the CNMI for the entire tax year, the resident status
for both spouses and subsequent tax treatment is determined by the
spouse with the higher AGI (disregarding community property laws). File
Form 5074 only if the spouse with the higher AGI is not a bona fide
resident of Guam or the CNMI for the entire tax year.
Where to file. If you are not enclosing a check or money order, file your
Form 1040 or 1040-SR (including Form 5074) with the Department of the
Treasury, Internal Revenue Service Center, Austin, TX 73301-0215 USA.
If you are including a check or money order, file your return with the
Internal Revenue Service, P.O. Box 1303, Charlotte, NC 28201-1303 USA.
Additional information. Pub. 570 has more information and an example
of how to complete Form 5074. To get Pub. 570, see How To Get Tax
Help in the Instructions for Forms 1040 and 1040-SR.

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▲

• Generally, dividends are sourced where the paying corporation is
created or organized.
• Taxable refunds, credits, or offsets of local Guam or CNMI income
taxes only include nonmirror code income taxes.
• Alimony received from a person who is a bona fide resident of Guam
or the CNMI is sourced in that specific territory.
• Except as provided in regulations, income earned after December 31,
2004, that is from sources within the United States or effectively
connected with the conduct of a trade or business in the United States
is not income from Guam or the CNMI.
• The source of gains, profits, or income from the sale or disposition of
real property (and any interest in real property) generally is where the
real property is located.
Personal property. The source of income from the sale of
nondepreciable personal property generally is the seller’s residence. For
example, if you are a bona fide resident of Guam or the CNMI, gain from
the sale or disposition of personal property generally is from sources
within Guam or the CNMI. Income from the sale of inventory generally is
sourced where the title to the property passes. See section 865 for
details.

DRAFT AS OF
June 14,
2019
▲
DO NOT FILE

Part I—Income From Guam or the CNMI Reported on
Form 1040, 1040-SR, or Schedule 1 (Form 1040 or
1040-SR), Part I

Note: See Schedule 1 (Form 1040 or 1040-SR), Part I, for additional
income from Guam or the CNMI not reported on Form 1040 or 1040-SR,
page 2.
Source of income. The rules for determining the source of income are
explained in sections 861 through 865 and section 937, Regulations
section 1.937-2, and chapter 2 of Pub. 570. Some general rules are:
• The source of wages, salaries, or tips generally is where the services
are performed. If you worked both in and outside Guam or the CNMI,
include on line 1 only wages, salaries, or tips earned while you were in
Guam or the CNMI. However, certain income earned while temporarily
performing services in Guam or the CNMI will not be considered income
from Guam or the CNMI.
De minimis exception. This is an exception to the general rule for
determining the source of income earned in Guam or the CNMI.
Generally, income from Guam or the CNMI does not include
compensation for services performed in Guam or the CNMI if during
2019 you:
• Were a U.S. citizen or resident;
• Were not a bona fide resident of Guam or the CNMI;
• Were not employed by or under contract with an individual,
partnership, or corporation that is engaged in a trade or business in
Guam or the CNMI;
• Temporarily performed services in Guam or the CNMI for 90 days or
less; and
• Earned $3,000 or less from such services.
Active duty U.S. Armed Forces. If you are a bona fide resident of
the CNMI or Guam and are stationed outside your territory of residence,
your military compensation will be sourced in the CNMI or Guam, as
applicable, under the Servicemembers Civil Relief Act (SCRA). If you are
not a bona fide resident of one of those territories but perform services
in one of them, however, your military compensation will not be sourced
there. For further details, see Pub. 570.
Military spouses. If you are the civilian spouse of a member of the
U.S. Armed Forces, work in Guam or the CNMI, and retain a residence
or domicile in one of the 50 states or the District of Columbia under the
Military Spouses Residency Relief Act (MSRRA), your wages, salaries,
tips, and self-employment income will not be considered income from
Guam or the CNMI. Under MSRRA, the military spouse must be in
Guam or the CNMI solely to be with his/her servicemember spouse who
is serving in compliance with military orders. For details on MSRRA, see
Pub. 570.
• The source of interest income generally is where the payer is located.
For example, Guam or CNMI source income includes interest from a
certificate of deposit issued by a bank or branch of a U.S. bank in Guam
or the CNMI.

Special rules may apply to bona fide residents of U.S.
territories who have gain from dispositions of certain
investment property within the 10-year period beginning
CAUTION when they became a bona fide resident. For details, see
Special Rules for Gains From Dispositions of Certain
Property, in chapter 2 of Pub. 570, Regulations section 1.937-2(f)(1),
and Examples 1 and 2 of section 1.937-2(k).

!

Part II—Adjustments to Income From Guam or the
CNMI Reported on Schedule 1 (Form 1040 or
1040-SR), Part II
Note: See Schedule 1 (Form 1040 or 1040-SR), Part II, for adjustments
to income from Guam or the CNMI.
Line 20. For tax years beginning after December 31, 2017, and before
January 1, 2026, a moving expense deduction is only allowed for a
member of the U.S. Armed Forces who moves pursuant to a military
order and incident to a permanent change of station.
Lines 21 through 23. If you had Guam or CNMI source selfemployment income, figure the amount to enter on each line by (1)
dividing your Guam or CNMI source self-employment income by your
total (worldwide) self-employment income, and (2) multiplying the total
amount of each deduction that applies to you by the result in (1).
Line 24. Enter the amount of penalty on early withdrawals from savings
accounts in banks or branches of U.S. banks located in Guam or the
CNMI. The Form 1099-INT or Form 1099-OID you received will show the
amount of any penalty you were charged.
Line 25. Enter the total of your and your spouse’s IRA deductions
attributable to Guam or CNMI compensation or earned income. Figure
the amount to report on line 25 by (1) dividing your Guam or CNMI
compensation or earned income by your total (worldwide) compensation
or earned income, and (2) multiplying the amount of your IRA deduction
by the result in (1). Figure the amount of your spouse’s IRA deduction
the same way.
Line 28. Include in the total on line 28 the amount of any other
deductions included on Schedule 1 (Form 1040 or 1040-SR), line 22,
that are attributable to your Guam or CNMI income. On the dotted line
next to line 28, enter the amount of each deduction attributable to your
Guam or CNMI income and identify it as you did on Schedule 1 (Form
1040 or 1040-SR), line 22. If you or your spouse had an Archer Medical
Savings Account deduction on Schedule 1 (Form 1040 or 1040-SR), line
22, figure the amount to report on line 28 the same way you would an
IRA deduction (see Line 25 above).
Line 29. Adjusted gross income from worldwide sources is reported on
line 8b of Form 1040 or 1040-SR.

Penalty for Failure To Furnish Information
If you became or ceased to be a bona fide resident of a U.S. territory,
you may be required to file Form 8898, Statement for Individuals Who
Begin or End Bona Fide Residence in a U.S. Possession. If you fail to
provide the required information, you may have to pay a $1,000 penalty
for each failure unless you can show the failure was due to reasonable
cause and not willful neglect. This penalty is in addition to any criminal
penalty provided by law. For details, see the Instructions for Form 8898.