IRS Form 8689 2018 Allocation of Individual Income Tax to the U.S. Virgin Islands

IRS Form 8689 is a U.S. Department of the Treasury - Internal Revenue Service - issued form also known as the "Allocation Of Individual Income Tax To The U.s. Virgin Islands".

A PDF of the latest IRS Form 8689 can be downloaded below or found on the U.S. Department of the Treasury - Internal Revenue Service Forms and Publications website.

ADVERTISEMENT
8689
Allocation of Individual Income Tax
OMB No. 1545-0074
2018
Form
to the U.S. Virgin Islands
Attach to Form 1040.
Department of the Treasury
Attachment
85
Go to www.irs.gov/Form8689 for the latest information.
Internal Revenue Service
Sequence No.
Name(s) shown on Form 1040
Your social security number
Part I
Income From the U.S. Virgin Islands (USVI)
1
Wages, salaries, tips, etc.
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Taxable interest .
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3
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Ordinary dividends .
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4
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Taxable refunds, credits, or offsets of local USVI income taxes .
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5
Alimony received
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5
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Business income or (loss)
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6
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Capital gain or (loss) .
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7
8
8
Other gains or (losses)
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9
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IRA distributions (taxable amount) .
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10
Pensions and annuities (taxable amount)
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10
11
Rental real estate, royalties, partnerships, S corporations, trusts, etc. .
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11
12
Farm income or (loss) .
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12
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Unemployment compensation .
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13
14
14
Social security benefits (taxable amount)
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15
15
Other income. List type and amount
16
Add lines 1 through 15. This is your total USVI income
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16
Part II
Adjusted Gross Income From the USVI
17
Educator expenses
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17
18
Certain business expenses of reservists, performing artists, and
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fee-basis government officials .
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19
Health savings account deduction
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19
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Moving expenses for members of the armed forces .
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20
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Deductible part of self-employment tax .
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21
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Self-employed SEP, SIMPLE, and qualified plans .
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Self-employed health insurance deduction .
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24
Penalty on early withdrawal of savings
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24
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IRA deduction
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25
26
Student loan interest deduction
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26
27
Tuition and fees deduction (see instructions)
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27
28
28
Add lines 17 through 27 .
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29
Subtract line 28 from line 16. This is your USVI adjusted gross income .
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29
Part III
Allocation of Tax to the USVI
30
Enter amount from Form 1040, line 15
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30
31
Enter total of certain amounts from Form 1040. See instructions on page 4 for amount to enter
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32
32
Subtract line 31 from line 30
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33
33
Enter amount from Form 1040, line 7 .
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34
Divide line 29 above by line 33. Enter the result as a decimal (rounded to at least 3 places). Do not
×
enter more than 1.000 .
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34
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35
Multiply line 32 by line 34. This is your tax allocated to the USVI
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35
Part IV
Payments of Income Tax to the USVI
36
36
Income tax withheld by the USVI .
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37
37
2018 estimated tax payments and amount applied from 2017 return
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Amount paid with Form 4868 (extension request) .
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38
39
Add lines 36 through 38. These are your total payments to the USVI .
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39
40
Enter the smaller of line 35 or line 39. Include this amount in the total on Form 1040, line 18. On
the dotted line next to line 18, enter “Form 8689” and show this amount .
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40
41
Overpayment to the USVI. If line 39 is more than line 35, subtract line 35 from line 39
41
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42
Amount of line 41 you want refunded to you .
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42
43
Amount of line 41 you want applied to your 2019 estimated tax
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43
44
Amount you owe to the USVI. If line 39 is less than line 35, subtract line 39 from line 35 .
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44
45
Enter the amount from line 44 that you will pay when you file your income tax return. Include this
amount in the total of Form 1040, line 18. On the dotted line next to line 18, enter “Form 8689”
and show this amount
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45
8689
For Paperwork Reduction Act Notice, see the Form 1040 instructions.
Form
(2018)
Cat. No. 64603D
8689
Allocation of Individual Income Tax
OMB No. 1545-0074
2018
Form
to the U.S. Virgin Islands
Attach to Form 1040.
Department of the Treasury
Attachment
85
Go to www.irs.gov/Form8689 for the latest information.
Internal Revenue Service
Sequence No.
Name(s) shown on Form 1040
Your social security number
Part I
Income From the U.S. Virgin Islands (USVI)
1
Wages, salaries, tips, etc.
.
.
.
.
.
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.
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1
2
Taxable interest .
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2
3
3
Ordinary dividends .
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4
4
Taxable refunds, credits, or offsets of local USVI income taxes .
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5
Alimony received
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5
6
Business income or (loss)
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6
7
Capital gain or (loss) .
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7
8
8
Other gains or (losses)
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9
9
IRA distributions (taxable amount) .
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10
Pensions and annuities (taxable amount)
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10
11
Rental real estate, royalties, partnerships, S corporations, trusts, etc. .
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11
12
Farm income or (loss) .
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12
13
Unemployment compensation .
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13
14
14
Social security benefits (taxable amount)
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15
15
Other income. List type and amount
16
Add lines 1 through 15. This is your total USVI income
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.
16
Part II
Adjusted Gross Income From the USVI
17
Educator expenses
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17
18
Certain business expenses of reservists, performing artists, and
18
fee-basis government officials .
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.
19
Health savings account deduction
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19
20
Moving expenses for members of the armed forces .
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20
21
Deductible part of self-employment tax .
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21
22
Self-employed SEP, SIMPLE, and qualified plans .
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22
23
23
Self-employed health insurance deduction .
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24
Penalty on early withdrawal of savings
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.
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.
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24
25
IRA deduction
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.
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.
25
26
Student loan interest deduction
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.
.
.
.
.
.
.
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.
.
.
26
27
Tuition and fees deduction (see instructions)
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.
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.
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.
27
28
28
Add lines 17 through 27 .
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29
Subtract line 28 from line 16. This is your USVI adjusted gross income .
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.
.
.
.
29
Part III
Allocation of Tax to the USVI
30
Enter amount from Form 1040, line 15
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30
31
Enter total of certain amounts from Form 1040. See instructions on page 4 for amount to enter
.
31
32
32
Subtract line 31 from line 30
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33
33
Enter amount from Form 1040, line 7 .
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34
Divide line 29 above by line 33. Enter the result as a decimal (rounded to at least 3 places). Do not
×
enter more than 1.000 .
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34
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35
Multiply line 32 by line 34. This is your tax allocated to the USVI
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.
35
Part IV
Payments of Income Tax to the USVI
36
36
Income tax withheld by the USVI .
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.
.
37
37
2018 estimated tax payments and amount applied from 2017 return
.
38
Amount paid with Form 4868 (extension request) .
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.
.
.
.
.
.
38
39
Add lines 36 through 38. These are your total payments to the USVI .
.
.
.
.
.
.
.
.
39
40
Enter the smaller of line 35 or line 39. Include this amount in the total on Form 1040, line 18. On
the dotted line next to line 18, enter “Form 8689” and show this amount .
.
.
.
.
.
.
.
.
40
41
Overpayment to the USVI. If line 39 is more than line 35, subtract line 35 from line 39
41
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42
Amount of line 41 you want refunded to you .
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42
43
Amount of line 41 you want applied to your 2019 estimated tax
.
.
43
44
Amount you owe to the USVI. If line 39 is less than line 35, subtract line 39 from line 35 .
.
.
.
44
45
Enter the amount from line 44 that you will pay when you file your income tax return. Include this
amount in the total of Form 1040, line 18. On the dotted line next to line 18, enter “Form 8689”
and show this amount
.
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45
8689
For Paperwork Reduction Act Notice, see the Form 1040 instructions.
Form
(2018)
Cat. No. 64603D
[This page left blank intentionally]
3
Form 8689 (2018)
Page
Part I—Income From the U.S. Virgin Islands
Section references are to the Internal Revenue Code
unless otherwise noted.
(USVI)
Future Developments
Source of income. The rules for determining the source
of income are explained in sections 861 through 865 and
For the latest information about developments related to
937, Regulations section 1.937-2, and chapter 2 of Pub.
Form 8689 and its instructions, such as legislation
570. Some general rules are:
enacted after they were published, go to
www.irs.gov/Form8689.
• The source of wages, salaries, or tips is generally where
the services are performed. If you worked both in and
At the time this form and instructions went to
!
outside the USVI, include on line 1 only wages, salaries,or
print, the tuition and fees deduction had expired.
tips earned while you were in the USVI. However, certain
To see if this deduction has been extended so
CAUTION
income earned while temporarily performing services in
you can claim it on your 2018 return, go to
the USVI will not be considered USVI source income. For
www.irs.gov/FormsUpdates.
details, see De minimis exception, later.
Instructions
Military spouses. If you are the civilian spouse of a
member of the U.S. Armed Forces, work in the USVI, and
Purpose of form. Use Form 8689 to figure the amount of
retain a residence or domicile in one of the 50 states, the
U.S. tax allocable to the U.S. Virgin Islands (USVI).
District of Columbia, or another U.S. territory, under the
Who must file. If you were a U.S. citizen or resident alien
Military Spouses Residency Relief Act (MSRRA) your
(other than a bona fide resident of the USVI) and had
wages, salaries, tips, and self-employment income will not
income from sources in the USVI or income effectively
be considered income from the USVI. Under MSRRA, the
connected with the conduct of a trade or business in the
military spouse must be in the USVI solely to be with his/
USVI, you may owe tax to the USVI. Your USVI tax
her servicemember spouse who is serving in compliance
liability is a percentage of your U.S. tax liability.
with military orders. For details on MSRRA, see Pub. 570.
Do not use this form if you were a bona fide
!
• The source of interest income is generally where the
resident of the USVI during the entire tax year,
payer is located. For example, interest from a certificate
or were considered a bona fide resident of the
CAUTION
of deposit issued by a USVI bank or a USVI branch of a
USVI for the entire tax year under the special
U.S. bank is USVI source income.
rules for the year of a move (see chapter 1 of Pub. 570,
• Generally, dividends are sourced where the paying
Tax Guide for Individuals With Income From U.S.
corporation is created or organized.
Possessions).
Joint returns. If you file jointly and only one spouse is
• Taxable refunds, credits, or offsets of local USVI income
taxes include only nonmirror code income taxes.
a bona fide resident of the USVI for the entire tax year,
the resident status for both spouses and subsequent tax
• Alimony received from a person who is a bona fide
treatment is determined by the spouse with the higher
resident of the USVI is USVI source income.
adjusted gross income (AGI) (disregarding community
• Except as provided in regulations, income earned after
property laws). File Form 8689 only if the spouse with the
December 31, 2004, that is from sources within the
higher AGI is not a bona fide resident of the USVI for the
United States or effectively connected with the conduct
entire tax year.
of a trade or business in the United States is not income
Where to file. You must file identical tax returns with the
from the USVI.
United States and the USVI. If you are not enclosing a
• The source of gains, profits, or income from the sale or
check or money order, file your original Form 1040
disposition of real property (and any interest in real
(including Form 8689) with the Department of the
property) is generally where the real property is located.
Treasury, Internal Revenue Service Center, Austin, TX
Personal property. The source of income from the sale
73301-0215 USA.
of nondepreciable personal property is generally the seller’s
If you are including a check or money order, file your
residence. For example, if you are a bona fide resident of
original return with the Internal Revenue Service, P.O. Box
the USVI, gain from the sale or disposition of personal
1303, Charlotte, NC 28201-1303 USA.
property is generally from sources within the USVI. Income
File a signed copy of your Form 1040 (with all
from the sale of inventory is generally sourced where the
attachments, forms, and schedules, including Form 8689)
title to the property passes. See section 865 for details.
with the Virgin Islands Bureau of Internal Revenue, 6115
De minimis exception. This is an exception to the
Estate Smith Bay, St. Thomas, VI 00802. They will accept
general rule for determining the source of income earned
a signed copy of your U.S. return and process it as an
in the USVI. Generally, income from the USVI does not
original return.
include compensation for services performed in the USVI
Additional information. Pub. 570 has more information
if during 2018 you:
and an example of how to complete Form 8689. To get
• Were a U.S. citizen or resident;
Pub. 570, see How To Get Tax Help in the Instructions for
• Were not a bona fide resident of the USVI;
Form 1040.
• Were not employed by or under contract with an
individual, partnership, or corporation that is engaged in a
trade or business in the USVI;
• Temporarily performed services in the USVI for 90 days
or less; and
• Earned $3,000 or less from such services.
4
Form 8689 (2018)
Page
Part II—Adjusted Gross Income From the
Part IV—Payments of Income Tax to the
USVI
USVI
Lines 21 through 23. If you had USVI source self-
Amounts overpaid to the United States generally will not
employment income, figure the amount to enter on each
be applied to the amount you owe to the USVI. Similarly,
line by (1) dividing your USVI source self-employment
amounts overpaid to the USVI will not be applied to the
income by your total (worldwide) self-employment
amount you owe to the United States.
income and (2) multiplying the total amount of each
Line 45. Enter the amount you owe to the USVI that you
deduction that applies to you by the result in (1).
will pay when you file your income tax return.
Line 24. Enter the amount of penalty on early withdrawals
Credit for U.S. tax paid to the USVI. You can take a
from savings accounts in USVI banks or USVI branches
credit on your U.S. return for the U.S. tax allocated to the
of U.S. banks. The Form 1099-INT or Form 1099-OID you
USVI only if you actually paid the tax to the USVI. To take
received will show the amount of any penalty you were
the credit, you must complete Form 8689 and attach it to
charged.
your Form 1040. Add line 40 and line 45 of Form 8689
Line 25. Enter the total of your and your spouse’s IRA
and include the amount in the total on Form 1040, line 18.
deductions attributable to USVI compensation or earned
On the dotted line next to line 18, enter “Form 8689” and
income. Figure the amount to report on line 25 by (1)
the amount paid.
dividing your USVI compensation or earned income by
Penalty for Failure To Furnish Information
your total (worldwide) compensation or earned income
If, in tax year 2001 or later, you became or ceased to be a
and (2) multiplying the amount of your IRA deduction by
bona fide resident of a U.S. possession, you may be
the result in (1). Figure the amount of your spouse’s IRA
required to file Form 8898, Statement for Individuals Who
deduction the same way.
Begin or End Bona Fide Residence in a U.S. Possession.
Line 28. Include in the total on line 28 the amount of any
If you fail to provide the required information, you may
other deductions included on Schedule 1 (Form 1040),
have to pay a $1,000 penalty for each failure unless you
line 36, that are attributable to your USVI income. On the
can show the failure was due to reasonable cause and
dotted line next to line 28, enter the amount of each
not willful neglect. This penalty is in addition to any
deduction attributable to your USVI income and identify it
criminal penalty provided by law. For details, see the
as you did on Schedule 1 (Form 1040), line 36. If you or
Instructions for Form 8898.
your spouse had an Archer MSA deduction on Schedule
1 (Form 1040), line 36, figure the amount to report on line
28 the same way you would an IRA deduction (see Line
25 above).
Line 31. Enter the total of the amounts from Form 1040,
lines 17a, 17b, and 17c. Include the total of the amounts
from Schedule 4 (Form 1040), lines 57, 58a, and 60a. Also
include any uncollected social security and Medicare or
tier 1 RRTA tax, tax on excess golden parachute
payments, or excise tax on insider stock compensation
reported on Schedule 4 (Form 1040), line 64. Also include
any amount from Form 5329, Parts III, IV, V, VI, VII, VIII, or
IX reported on Schedule 4 (Form 1040), line 59. Also
include the total of the amounts from Schedule 5 (Form
1040), lines 74b and 74d.

Download IRS Form 8689 2018 Allocation of Individual Income Tax to the U.S. Virgin Islands

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