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I am a resident of Utah. I have the ability to telecommute (work from home) whenever I want (or work from a coffee shop, it doesnt have to literally be my home). I would like to relocate to Puerto Rico for a short duration (lets say 2 weeks for example) and work from there. I can today simply take a vacation and travel there for however long I want (as long as I have enough vacation time to cover my stay). However, when I told my employer I want to work from Puerto Rico they seem to think that duration has no effect what so ever on the tax implications for my trip and that I would have to be taxed per Puerto Rico tax laws. That is too much work for their hr department to deal with so they basically denied my request.

Is this true? If not, can you point me to some sources that show that I can live/work there and still be taxed as a Utah resident. If thats not the case, then whats the difference between me working there, and taking vacation there, if with both im making the same exact income?

To be clear my intention is to visit the country short term (less then a month, or whatever the tax requirements state is legal for a 'visit') but happen to be working on my visit.

littleadv
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n00b
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1 Answers1

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That is true. You'll still be Utah resident, you'll be taxed by PR for whatever you've earned while staying there, as a non-resident. This is similar to any other US state, in fact.

The difference between working there and "taking a vacation" there (i.e.: not working, or working without telling anyone) is that the employer is also subject to the NR-taxation rules.

You personally can ignore the law and not pay the tax (this is called tax evasion). When you're officially employed and working while there, the employer is liable as well, and they're much more reluctant to become tax evaders than individuals.

Instructions to the PR tax form are here, the description of taxation of non-residents, and the rules for residency determination, are on page 11.

Re the tax evasion, needless to say that it is illegal, and I'm advising strongly against it.

littleadv
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