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If you're a bona fide resident of Puerto Rico during the entire tax year, you generally aren't required to file a U.S. federal income tax return if your only income is from sources within Puerto Rico.
You must file Form 1040-SS if you meet all three requirements below. 1. You, or your spouse if filing a joint return, had net earnings from self-employment (from other than church employee income) of $400 or more (or you had church employee income of $108.28 or moresee Church Employees, later).
About Form 1040-SS, U.S. Self-Employment Tax Return (Including the Additional Child Tax Credit for Bona Fide Residents of Puerto Rico)
The new tax contributes 1% to the municipality level and 10.5% to the "state" level. The IVU was scheduled to expire on 1 April 2016, to be replaced with a value-added tax (VAT) of 10.5% for the state level, with the 1% IVU continuing for the municipalities.
A self employed person can be a sole proprietorship, an independent contractor, or a freelancer. You are considered self employed even if you are paid in cash and do not receive a 1099-MISC or 1099-NEC.
Excise tax: depends on the category of goods. Sales and use tax: 11.5 percent on most goods and services. 10.5 percent on goods and services not subject to municipal SUT.
Since these forms are virtually identical in function, the main reason to use Form 1040-SR is if you're filling out your tax return by hand rather than online. Form 1040-SR has larger type and larger boxes to write numbers in, making it slightly easier for seniors to read and fill out.
Puerto Rico will soon be replacing its existing state-level sales and use tax with a value added tax (VAT) system.
Self-employed taxpayers are subject to the total 15.3% tax rate comprised of 12.4% for OASDI and 2.9% for Medicare. The self-employment tax rate for self-employment income earned is 15.3% (12.4% for Social Security and 2.9% for Medicare).
You should file Form 1040 if: Your taxable income is greater than $100,000. You itemize deductions. You receive income from the sale of property.