Instructions
This calculator is designed to calculate and illustrate estimated income tax exemption amounts for an Economic Development Commission beneficiary.  It will illustrate the income tax amounts that the EDC Program can save you and your business by calculating 'Before' and 'After' scenarios for U.S. Federal and State income taxes before and after (or with and without) utilizing the tax benefits available through the US Virgin Islands EDC Program.

INPUT FORM:

Name and Email:  The information in this field is used to send a copy of the calculator report to the email address that you provide.

State:  The information in this field is used to compute State income taxes.  Choose the State in which you or your business currently pays State income taxes.

Taxable EDC Income (Non-US Source) = All "Non-US Source" taxable income that is effectively connected to the US Virgin Islands and eligible for EDC tax benefits.

Taxable Non-EDC Income (US Source) = All taxable income that is NOT effectively connected to the US Virgin Islands and not eligible for EDC tax benefits.  For your convenience, up to three separate sources may be identified and input.

*** Note:  For definitions of Non-US Source and US Source income, please see FAQ, Question 3. ***

REPORT ILLUSTRATING CALCULATIONS:

Taxable Income:  This section calculates the total 'EDC Eligible' and 'Non-EDC Eligible' taxable income.

BEFORE:  Total Income Tax Before EDC Tax Benefits

This section calculates the estimated federal and state income tax from the taxable income.  Federal tax is calculated at a tax rate of 35%.  State tax is calculated at the highest tax rate (or the highest tax rate for taxable income under $1,000,000.00) for the State selected.

EDC Calculations:

This section calculates the following:

(1)  the percentage of  total taxable income eligible for EDC benefits (i.e. EDC Eligible Income / Non EDC Eligible Income).

(2)  the amount of the total taxable income subject to the EDC income tax exemption (90% of the federal income tax).  Also, none of the EDC Eligible income is subject to a State income tax because no State income tax equivalent is imposed in the US Virgin Islands.  [Note: It has been assumed that any income that is not EDC Eligible income is subject to State tax in the State selected.  This may or may not be accurate and is dependent upon various factual circumstances that are beyond the scope and basic illustration purposes of this calculator.]

AFTER:  Total Income Tax After EDC Tax Benefits

This section calculates the estimated amounts of Federal, State and US Virgin Islands income tax due on taxable income eligible for EDC tax benefits, and taxable income not eligible for EDC tax benefits.

EDC Exemption SAVINGS:

This section calculates and illustrates the tremendous TAX SAVINGS that you can achieve through the EDC Program.  It is calculated by subtracting your income tax liability after utilizing the EDC Program from your income tax liability before utilizing the EDC Program.

 

IRS "Circular 230" Notice:

Clearwater is not engaged in the professional practice of rendering tax advice.  Nevertheless, we believe it appropriate to advise you that, pursuant to U.S. regulations imposed on practitioners who render tax advice (”Circular 230″), any tax advice that may be construed to be contained herein is not intended, written or made available to be used for the purpose of avoiding tax penalties that may be imposed by the Internal Revenue Service.  To the extent that it may be construed that advice is or is intended to be used or referred to in promotion, marketing or recommending a partnership or other entity, investment plan or arrangement, the regulations under Circular 230 require that we advise you as follows: (1) the information contained on this site is not intended or written to be used, and cannot be used, for the purpose of avoiding tax penalties that may be imposed on a taxpayer; (2) the advice was written to support the promotion or marketing of the transaction(s) or matter(s) addressed by the written advice; and (3) the taxpayer should seek advice based on the taxpayer’s particular circumstances from an independent tax advisor.

Please be advised that this calculator is to be used for basic illustration purposes only.  The accuracy of all of the calculations are dependent upon the accuracy and completeness of the information that you input into the calculator's input fields and are also based upon the various assumptions as identified and described above.  This calculator (1) does not take into account your unique factual circumstances which may require additional analysis and advice, (2) does not determine whether or not any taxable income is or is not eligible for EDC tax benefits, and (3) is not to be relied upon instead of professional tax advice.