How Long Must One Stay in the USVI to be Considered a ‘Resident’ to Qualify for the 90% Residency Tax Credit?

Beckett G. Cantley, How Long Must One Stay in the USVI to be Considered a ‘Resident’ to Qualify for the 90% Residency Tax Credit?, 13 J. Transnat’l L. & Pol’y 153 (Fall 2003).

Summary.  This article analyzed the length of stay requirement for obtaining residency in the United States Virgin Islands (“USVI”).  Residents of the USVI generally file their tax returns with the USVI tax authorities rather than the IRS.  Such residents also generally make all tax payments to the USVI taxing authorities.  Residents of the USVI can be eligible for as much as a ninety percent (90%) tax credit on their personal income or investment income from ownership in certain business entities, by taking advantage of the Economic Development Commission program for investment in the USVI.  These credits have been in existence for almost fifty (50) years and are filled with historical precedent.  These credits are also safely guarded by many members of the US Congressional Black Caucus.  The article concluded that it is clear that a person must reside in the USVI on the last day of the tax year to be considered a “resident”.  However, unlike the United States, the article concluded that there does not appear to be a one hundred eighty-three (183) day residency requirement to be considered a resident of the USVI.  The article further concluded that there are a series of possible residency requirements that depend on the facts and circumstances of each case.  The article discussed many of these facts and circumstances and provides a policy argument for which ones make the most sense.