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Form 8689: Allocation of Individual Income Tax to the U.S. Virgin Islands
IRS Form 8689 is used for Allocation of Individual Income Tax to the U.S. Virgin Islands and attaches to Form 1040 or 1040-SR. A penalty of $1,000 may apply if information is not provided.
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IRS Form 8689 - Allocation of Individual Income Tax to the U.S. Virgin Islands
IRS Form 8689 is used for Allocation of Individual Income Tax to the U.S. Virgin Islands and attaches to Form 1040 or 1040-SR. A penalty of $1,000 may apply if information is not provided.
Risk Radar
Scan points- 1Do not use Form 8689 if you were a bona fide resident of the USVI for the entire tax year.
- 2Filing without listing all income types from lines 1 through 6 in Part I.
- 3Failing to subtract line 29 from line 16 when calculating USVI adjusted gross income on line 30.
- 4Entering the wrong total tax amount from your return onto line 31 of Part III.
- 5Not including the amount of USVI income tax withheld (box 2 of Form W-2VI) on line 37.
Plain English
This form calculates how much of your total U.S. income tax bill should be assigned to the U.S. Virgin Islands (USVI). It helps you determine your USVI tax liability percentage so you can properly credit that amount on your federal return. You must file this form if you have USVI income or income connected to a USVI business.
Submission Date
- Filing date: 2025-11-03 22:10:19
- Preparation window: collect IDs, supporting records, and signatures in advance.
- Final review: verify names, dates, and required fields before submission.
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What this form is for
- Use this form when a U.S. citizen or resident alien (who is not a bona fide resident of the USVI) has income from sources in the USVI or income effectively connected with a trade or business in the USVI.
- Do not use Form 8689 if you were a bona fide resident of the USVI during the entire tax year, or if you meet the special rules for the year of a move (see chapter 1 of Pub. 570).
- Check Form 869 instead when listing the name(s) shown on your tax return to attach with Form 8689.
Form selector
Use this form or another form?
Filing jointly and only one spouse is a bona fide resident of the USVI for the entire year
The determination of resident status relies on the spouse with the higher Adjusted Gross Income (AGI)
✓ Confirm this form is filed if the higher AGI spouse is not a bona fide resident.
Filing an amended return for income tax
You can e-file or send paper Form 1040-X to the IRS, but must file identical returns with the USVI
✓ Ensure you use the correct address for the Virgin Islands Bureau of Internal Revenue when sending paper.
Beginning or ending bona fide residence in a U.S. Territory (other than the USVI)
This form is required if you meet this condition, and failure to file may incur a $1,000 penalty per failure
✓ Verify that your Form 8689 filing aligns with any requirements from Form 8898.
Deadline or filing window
The form must be filed when filing your U.S. return, but it is not tied to a specific date in the source. If you file jointly and only one spouse is a bona fide resident of the USVI, ensure you file Form 8689 only if that higher AGI spouse is NOT a bona fide resident for the entire year.
Checklist
What you need before filling it out
Form Purpose
Use to figure the amount of U.S. tax allocable to the USVI · Instructions p.3
Who must file
U.S. citizen or resident alien (not a bona fide resident of the USVI) with USVI income/connected business income · Instructions p.3
USVI Address
6115 Estate Smith Bay, Suite 225, St. Thomas, VI 00802 · Instructions p.3
Penalty Amount (Failure to provide info)
$1,000 per failure · Form p.4
Required Attachment
Identical tax returns with the United States and the USVI · Instructions p.3
Income Line 1 (Wages, salaries, tips)
Amount from USVI source · Form p.1
Before you submit
- 1Ensure the Name(s) and Social Security Number listed match those on your Form 1040 or 1040-SR.
- 2Confirm all income sources are accounted for across Part I lines 1 through 6.
- 3Verify that total USVI payments (Line 40) is correctly calculated by adding lines 37 through 39.
- 4Check if the smaller of Line 36 or Line 40 amount has been added to the 'Other refundable credits' line on Schedule 3 (Form 1040).
- 5Determine if you have an overpayment (Line 42) and specify the desired refund/estimated tax application.
- 6If you owe (Line 45), ensure Line 40 was less than Line 36.
- 7Confirm that the return submitted to the USVI is a signed copy of your complete U.S. filing.
How to file this form
- 1Complete Part I by entering all income amounts from the U.S. Virgin Islands onto lines 1 through 6 of Form 8689.
- 2Calculate total USVI payments on Line 40 by adding your estimated tax payments (Lines 37-39).
- 3Determine if you have an overpayment or amount owed, filling out Lines 42, 43, 44, and 45 accordingly.
- 4Attach Form 8689 to your U.S. tax return (Form 1040 or 1040-SR) and submit a signed copy to the Virgin Islands Bureau of Internal Revenue at 6115 Estate Smith Bay, Suite 225, St. Thomas, VI 00802.
Known limitations
- 1Do not use Form 8689 if a filer was a bona fide resident of the U.S. Virgin Islands during the entire tax year.
- 2Do not use Form 8689 if a filer was considered a bona fide resident for the entire tax year under special rules for the year of a move (see chapter 1 of Pub. 570).
- 3If filing jointly and only one spouse is a bona fide resident of the U.S. Virgin Islands for the entire tax year, file Form 8689 only if the spouse with the higher adjusted gross income is not a bona fide resident of the U.S. Virgin Islands for the entire tax year.
Field map
Compact field-by-field guide
General Info
2 items
Full legal name and taxpayer identification number (SSN or EIN).
Current mailing address.
Details
2 items
Complete all applicable sections of this form according to the official IRS instructions.
Enter the relevant dollar amount if this form involves tax calculation.
Certification
1 items
Read and acknowledge any certifications required by this form.
Signatures
1 items
Sign and date. Unsigned forms cannot be processed.
Almost done reviewing the fields?
Fillable formOpen in Editor->The current edition is 20/25. The source directs users to www.irs.gov/Form8689 for the latest information regarding developments related to Form 8689.
What changed or needs a fresh check
- Edition date — confirm the revision reads 20/25.
- Fee — Not stated in the official source.
- Mailing address (USVI) — confirm the address is 6115 Estate Smith Bay, Suite 225, St. Thomas, VI 00802.
- Signature — ensure a signed copy of your tax return (including Form 8689) is submitted.
Quick Facts
Downloads
After you file
- 1Keep a signed copy of your completed tax return (including Form 8689) as proof.
- 2File an identical tax return with both the United States and the U.S. Virgin Islands.
- 3If you file jointly, ensure you add line 41 and line 46 of Form 8689 to the total on the “Other refundable credits” line on Schedule 3 (Form 1040).
- 4To claim a credit for U.S. tax paid to the U.S. Virgin Islands, you must complete and attach Form 8689 to your Form 1040 or 1040-SR.
- 5If an error occurs, use Form 1040-X (Amended U.S. Individual Income Tax Return) to correct the federal return.
Sources
- SRCInstructions p.1 — Form 8689 attaches to Form 1040 or 1040-SR.
- SRCForm p.3 — The purpose of Form 8689 is to figure the amount of U.S. tax allocable to the U.S. Virgin Islands (USVI).
- SRCForm p.3 — A filer may need to use this form if they are a U.S. citizen or resident alien (other than a bona fide resident of the USVI) and had income from sources in the USVI or income effectively connected with the conduct of a trade or business in the USVI.
- SRCForm p.3 — If filing jointly, Form 8689 is filed only if the spouse with higher AGI is not a bona fide resident of the USVI for the entire tax year.
- SRCForm p.1 — The calculation for USVI adjusted gross income is found on line 30: Subtract line 29 from line 16.
- SRCForm p.4 — Line 37 requires including the amount of your USVI income tax withheld (box 2 of Form W-2VI).
- SRCForm p.4 — To take a credit for U.S. tax paid to the USVI, you must add line 41 and line 46 of Form 8689 and include the total in the “Other refundable credits” line on Schedule 3 (Form 1040).
Common confusion points
What is my USVI Adjusted Gross Income?
Subtract line 29 from line 16 on Form 8689, which results in your USVI adjusted gross income (line 30).
Do I include the USVI withheld amount when filing federally?
Yes, enter the amount of your USVI income tax withheld (box 2 of Form W-2VI) on line 37 of Form 8689.
When do I take the credit for U.S. tax paid to the USVI?
You can take a credit on your U.S. return only if you actually paid the tax to the U.S. Virgin Islands, which requires completing and attaching Form 8689.
Workflow map
Related forms and next steps
Before
Current
After
Often used with
⚠ If something goes wrong
- Form 8898 is required if you became or ceased to be a bona fide resident of a U.S. territory.
Questions about IRS Form 8689
What is IRS Form 8689 used for?
This form calculates how much of your total U.S. income tax bill should be assigned to the U.S. Virgin Islands (USVI). It helps you determine your USVI tax liability percentage so you can properly credit that amount on your federal return. You must file this form if you have USVI income or income connected to a USVI business.
Who must file IRS Form 8689?
Individuals who are a U.S. citizen or resident alien (but not a bona fide resident of the USVI) and have income from sources in the USVI or income effectively connected with a trade or business in the USVI must file Form 8689.
What information does IRS Form 8689 require?
Part I lists your name(s), SSN, and details specific income types like Wages, salaries, tips, etc. Part III calculates the allocation by comparing your total tax (line 31) against your adjusted gross income (line 34).
When is IRS Form 8689 due?
The form must be filed when filing your U.S. tax return; there is no specific deadline date mentioned for the filing window itself.
Where do I file IRS Form 8689?
You must file identical tax returns with both the United States and the USVI. For the USVI, a signed copy goes to the Virgin Islands Bureau of Internal Revenue at 6115 Estate Smith Bay, Suite 225, St. Thomas, VI 00802.
How do I complete IRS Form 8689?
First, complete Part I with your identifying information. Next, detail your income in Part I (lines 1 through 6). Then, calculate the USVI adjusted gross income on line 30 before moving to Part III to allocate the tax based on lines 31 and 34.
What happens if IRS Form 8689 is filed incorrectly?
If you fail to provide the required information on Form 8689, you may have to pay a $1,000 penalty for each failure unless reasonable cause and not willful neglect can be shown.
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