Allocation of Individual Income Tax to Guam or the

Commonwealth of the Northern Mariana Islands (CNMI) Form 5074 OMB No. 1545-0074

© Attach to Form 1040. Department of the Treasury

Internal Revenue Service

Attachment

Sequence No. 60

Name(s) shown on Form 1040 Your social security number

Guam CNMI

Income From Guam or the CNMI Reported on Form 1040

1 Wages, salaries, tips, etc. 1

2 Taxable interest 2

3 Ordinary dividends 3

4 Taxable refunds, credits, or offsets of local Guam or CNMI income taxes 4

5 Alimony received 5

6 Business income or (loss) 6

7 Capital gain or (loss) 7

8 8

9

Other gains or (losses)

9

10

IRA distributions (taxable amount)

10

11

Pensions and annuities (taxable amount)

11

12

Rental real estate, royalties, partnerships, S corporations, trusts, etc.

12

13

Farm income or (loss)

13

14

Unemployment compensation

14

15

Social security benefits (taxable amount)

15

16

Other income. List type and amount ©

16 Total income. Add lines 1 through 15 ©

Adjusted Gross Income From Guam or the CNMI Reported on Form 1040

19

Moving expenses

19

21

Penalty on early withdrawal of savings

21

22 22

23

IRA deduction

23

24

Student loan interest deduction

24

25

Tuition and fees deduction

25

26

Add lines 17 through 27

26

27

Adjusted gross income. Subtract line 28 from line 16 ©

27

Payments of Income Tax to Guam or the CNMI

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 31

32 Income tax withheld from your wages while employed as a member of

the U.S. Armed Forces in Guam or the CNMI 32

33 Income tax withheld from your wages earned in Guam or the CNMI other 

than amounts on lines 30 through 32 33

34 Total payments. Add lines 30 through 33 © 34

Instructions

Part III

Part I

Part II

20

Self-employed health insurance deduction

20

Section references are to the Internal Revenue Code unless

otherwise noted.

28 28

(Continued on back)

One-half of self-employment tax

17 Educator expenses

18

Health savings account deduction

17

18

Certain business expenses of reservists, performing artists, and

fee-basis government officials

Self-employed SEP, SIMPLE, and qualified plans

29 29

30 30

Reminder. If, in tax year 2001 or later, you became or ceased to

be a bona fide resident of a U.S. possession, you may be

required to file Form 8898, Statement for Individuals Who Begin

2008

or End Bona Fide Residence in a U.S. Possession. The penalty

for failure to provide the required information is $1,000. For

details, see the Instructions for Form 8898.

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.
Form 5074 (2008) Page 2

Paperwork Reduction Act Notice. We ask for the information on

this form to carry out the Internal Revenue laws of the United

States. You are required to give us the information. We need it to

ensure that you are complying with these laws and to allow us to

figure and collect the right amount of tax.

The average time and expenses required to complete and file

this form will vary depending on individual circumstances. For the

estimated averages, see the instructions for your income tax

return.

You are not required to provide the information requested on a

form that is subject to the Paperwork Reduction Act unless the

form displays a valid OMB control number. Books or records

relating to a form or its instructions must be retained as long as

their contents may become material in the administration of any

Internal Revenue law. Generally, tax returns and return information

are confidential, as required by section 6103.

If you have suggestions for making this form simpler, we would

be happy to hear from you. See the instructions for your income

tax return.

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).

● You file a U.S. income tax return.

● You report 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 entire tax year under the special rules

for the year of a move (see Pub. 570, chapter 1).

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 adjusted gross

income (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. File your Form 1040 (including Form 5074) with

the Department of the Treasury, Internal Revenue Service Center,

Austin, TX 73301-0215.

Additional information. Pub. 570 has more information and an

example of how to complete Form 5074. To get Pub. 570, see

Quick and Easy Access to Tax Help and Tax Products in the

instructions for Form 1040.

Part I—Income From Guam or the CNMI

Reported on Form 1040

Source of income. The rules for determining the source of

income are explained in sections 861 through 865, section 937,

in Regulations section 1.937-2, and in chapter 2 of Pub. 570.

Some general rules are:

● The source of wages, salaries, or tips is generally 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.

● The source of interest income is generally 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.

● 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 possession.

● 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.

Personal property. The source of income from the sale of

nondepreciable personal property is generally 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 is

generally from sources within Guam or the CNMI. Income from

the sale of inventory is generally sourced where the title to the

property passes. See section 865 for details.

Part II—Adjusted Gross Income From

Guam or the CNMI Reported on Form 1040

Lines 21 through 23. If you had Guam or CNMI source

self-employment 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 Form 1040, line 36, 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 Form 1040, line 36. If

you or your spouse had an Archer MSA deduction on Form 1040,

line 36, figure the amount to report on line 28 the same way you

would an IRA deduction (see Line 25, above).

Penalty for Failure To Furnish Information

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.

CAUTION

Special rules may apply to bona fide residents of U.S.

possessions who have gain from dispositions of

certain investment property within the 10-year period

beginning when they became a bona fide resident.

For details, see chapter 2 of Pub. 570, Regulations

section 1.937-2(f)(1), and Examples 1 and 2 of section 1.937-2(k).

CAUTION

● The source of gains, profits, or income from the sale or

disposition of real property (and interest in real property) is

generally where the real property is located.