If you are self-employed in a U.S. Territory but are not required to file a U.S. income tax return, you will need to file IRS Form 1040-SS (U.S. Self-Employment Tax Return) to report your earnings. By filing your earnings with the U.S. Government, you will be able to claim certain credits, pay your Social Security and Medicare taxes, and potentially receive benefits under these programs.

What Is Form 1040-SS?

The 1040-SS form is tax return form filed by those that are self-employed in certain U.S. territories. The main purpose of IRS Form 1040-SS is to report the total wages earned from self-employment so the appropriate income taxes can be paid. Form 1040-SS impacts taxpayers residing in the U.S. Virgin Islands, American Samoa, Puerto Rico, the Commonwealth of the Northern Mariana Islands, and Guam that are not required by law to file standard U.S. income tax returns.

Previously, Puerto Rico tax filers could use the 1040-SS form to claim the Additional Child Tax Credit. However, for tax years 2019 and forward, taxpayers that are bona fide residents of Puerto Rico and want to claim the Additional Child Tax Credit should include Schedule 8812 with their 1040-SS form when submitting their tax return.

What Is Form 1040-PR?

IRS Form 1040-PR for Spanish Speakers is available for those who are a resident of Puerto Rico but do not speak English or prefer Spanish.

Form 1040-SS Instructions

To ensure you complete the 1040-SS form correctly, you will need to carefully follow the IRS instructions, which are available in English and Spanish. The 1040-SS instructions will guide you through how to calculate your SE tax, net earnings, and net profit or loss. When filing Form 1040-SS, here are a few important guidelines to keep in mind:

  • If you make earnings of $400 or more from self-employment, you are required to file and pay self-employment (SE) taxes
    • If you earned income from a Church, you must pay SE tax on earnings of $108.28 or more
  • You will need to provide income and expense information for your business to calculate your profits and losses, SE tax, and net earnings
  • You must file your 1040-SS form by April 15th (or the next following business day if it falls on a weekend or holiday)
    • If you cannot file by this deadline, you may be granted an automatic extension or can apply for a longer extension
  • Up to $128,400 of your self-employment income is subject to social security
  • You can mail-in or e-file your 1040-SS form
  • You may also be required to file an income tax return with the government where you are residing

Once you’ve completed Form 1040-SS, you can use Form 1040-ES to calculate your estimated tax and make your payments. If you’re going to make your payments with a check or money order, you’ll need to use a payment voucher found on the form.

We Can Help You File Your 1040-SS

Filing taxes on your own from abroad can be difficult, but with Community Tax, we make it easy. Request a free consultation online or call us at (844) 325-4360 to get help from a tax professional who can walk you through the process or complete your 1040-SS on your behalf.