rm 4563

Department of the Treasury
Internal Revenue Service

Exclusion of Income for Bona Fide Residents
of American Samoa

> See instructions below and on back.
> Attach to Form 1040.

OMB No. 1545-0173

1989

Attachment
Sequence No. 61

Name(s) shown on Form 1040

Your social security number

A Date bona fide residence began
B_ Kind of living quarters in >
American Samoa

O Rented room
1 Quarters furnished by employer
C Did any of your family live with you in American Samoa during any part ofthe taxyear? . . .

If “Yes,” who and for what period? >.

D Did you maintain any home(s) outside of American Samoa? .

If “Yes,” show address of your home(s), whether it was rented, and the names and relationships of the occupants >

Rented house or apartment
C Purchased home

: 2... . . Ces

OONo

E Name and address of employer (state if self-employed) >

F Complete the following for days absent from American Samoa during 1989.

Date of
departure

Date of
return

Number of days
absent

Reason for absence

Include on lines 1 through 8 below only income that qualifies for the exclusion. (See the instructions.)

LJ
1 Wages, salaries, tips, etc. . 1
2 Taxable interest income 2
3 Dividend income ee eee 3
4 Rentandroyaltyincome . ... . 4
5 Business income 5
6 Farm income . 6
7 Capital gains ee ee ee 7
8 Other income (list type and amount) >
8

9 Add the amounts on lines 1 through 8 and enter the total. This is the amount you may exclude from your

1989 grossincome . . . . ee ee > 9

Instructions would be happy to hear from you. You can write to either IRS or the

(Section references are to the Internal Revenue Code.)

Paperwork Reduction Act Notice

We ask for this information to carry out the Internal Revenue laws
of the United States. We need it to ensure that taxpayers are
complying with these laws and to allow us to figure and collect the
right amount of tax. You are required to give us this information.

The time needed to complete and file this form will vary
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Recordkeeping . . . . 2... ee « « 33min.
Learning aboutthelawortheform. . . . . . . Smin.
Preparingtheform . . . . . ..... . . 25min.
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theformtoIRS ........ woe ee 17min.

If you have comments concerning the accuracy of these time
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Office of Management and Budget at the addresses listed in the
Instructions for Form 1040.

Purpose

If you qualify, use Form 4563 to figure the amount of income you
can exclude.

Who Qualifies

You qualify for the exclusion if you were a bona fide resident of
American Samoa during all of 1989 (see Bona Fide Residence Test
on page 2).

Note: Bona fide residents of Guam will qualify for the exclusion
effective January 1, 1991 (or earlier if the two governments agree).
In future years, bona fide residents of the Commonwealth of the
Northern Mariana Islands (CNMI) may also qualify for the exclusion.
They will not qualify, however, unless an implementation agreement
is in effect between the CNMI and the United States. At the time
this form went to print, the CNMI had not entered into an
implementation agreement.

Form 4563 (1989)


Form 4563 (1989)

Page 2

Bona Fide Residence Test.—To qualify under this test you must
be a bona fide resident of American Samoa for an uninterrupted
period that includes a complete tax year (January 1-December 31,
if you file a calendar year return).

No specific rule determines whether you are a bona fide resident
of American Samoa. At the time this form went to print, regulations
were being written defining the bona fide residence test under
section 931. The following factors may be considered:

@ Intent;
e Establishment of a permanent home;

¢ Assimilation into the social, cultural, and economic environment;
and
e Physical presence.

Other factors that may be considered are the nature, extent and
reasons for temporary absences; assumption of economic burdens
and payment of taxes to American Samoa; existence of other
homes outside American Samoa; and place of employment.

What Income Can Be Excluded

If you qualify, you can exclude the following:

@ Income received from sources in America Samoa, Guam, and the
CNMI; and

@ Income effectively connected with the conduct of a trade or
business in those possessions.
Get Pub. 570, Tax Guide for Individuals in U.S. Possessions, for

information on how to determine the source of income.

Employees of the United States.—Amounts paid to you for
services you performed as an employee of the U.S. Government or
any of its agencies cannot be excluded. This rule applies to both
civilian and military employees.

Income You Must Report on Form 1040

Even if you qualify for the exclusion, you must still report on Form
1040 your worldwide income (less the exclusion allowed by this
form). This includes all income you received during 1989 that does
not qualify for the exclusion. The source of that income does not
matter.

Deductions and Credits You May Not Take
on Form 1040

If you claim the exclusion, you may not take any deduction or credit
on Form 1040 that is definitely related to the excluded income.

Deductions and credits that are not definitely related to any
particular type of income must be allocated between your
excludable income and your other income to find the amount you
can claim on Form 1040. Examples of deductions that are not
definitely related to any particular type of income are the standard
deduction and certain itemized deductions (such as medical
expenses, charitable contributions, and real estate taxes and
mortgage interest on your personal residence).

For more information, including how to figure the amount
allocable to the excluded income, see Pub. 570.
Note: You can take a deduction for each exemption you are
entitled to claim. This deduction is not considered allocable to the
excluded income.

Self-Employed Individuals

If you were self-employed and your net earnings from self-
employment were $400 or more, you will generally have to pay
self-employment tax on those earnings even though you can
exclude them from your gross income. Use Schedule SE (Form
1040) to figure any self-employment tax due.

Where To File

Mail your return to the Internal Revenue Service Center,
Philadelphia, PA 19255, U.S.A.

Note: /f you do not qualify for the exclusion, follow the Instructions
for Form 1040. Report all your taxable income, including income
from U.S., foreign, and possession sources. File your return with
the Internal Revenue Service Center shown in the Form 1040
Instructions for the place where you live.