capital gains question (ewwww)

I "think" they'd be considered income from the VI. I've sold stocks a while back & didn't send payment for partial taxes to Philadelphia & I always have my taxes done by a pro but I could be & very well might be wrong.

Was able to find this on the irs website at http://www.irs.gov/publications/p570/ch02.html#d0e1969

Sales or Other Dispositions of Property

The source rules for sales or other dispositions of property are varied. The most common situations are discussed below[...]

Personal property. The term “personal property” refers to property (such as machinery, equipment, or furniture) that is not real property. Generally, gain or loss from the sale or other disposition is sourced according to the seller's tax home. If personal property is sold by a bona fide resident of a relevant possession, the gain or loss from the sale is treated as sourced within that possession.

This rule does not apply to the sale of inventory, intangible property, depreciable personal property, or property sold through a foreign office or fixed place of business. The rules applying to sales of inventory are discussed below. For information on sales of the other types of property mentioned, see Internal Revenue Code section 865.

Inventory. Your inventory is personal property that is stock in trade or that is held primarily for sale to customers in the ordinary course of your trade or business. The source of income from the sale of inventory depends on whether the inventory was purchased or produced.

Purchased. Income from the sale of inventory that you purchased is sourced where you sell the property. Generally, this is where title to the property passes to the buyer.

Produced. Income from the sale of inventory that you produced in a relevant possession and sold outside that possession (or vice versa) is sourced based on an allocation. For information on making the allocation, see Regulations section 1.863-3(f).

Special rules for gains from dispositions of certain property. There are special rules for gains from dispositions of certain investment property (for example, stocks, bonds, debt instruments, diamonds, and gold) owned by a U.S. citizen or resident alien prior to becoming a bona fide resident of a possession. You are subject to these special rules if you meet both of the following conditions.

* For the tax year for which the source of the gain must be determined, you are a bona fide resident of the relevant possession.
* For any of the 10 years preceding that year, you were a citizen or resident alien of the United States (other than a bona fide resident of the relevant possession).

If you meet these conditions, gains from the disposition of this property will not be treated as income from sources within the relevant possession for purposes of the Internal Revenue Code. Accordingly, bona fide residents of American Samoa and Puerto Rico, for example, may not exclude the gain on their U.S. tax return. (See chapter 3 for additional information on filing requirements.) With respect to the CNMI, Guam, and the USVI, the gain from the disposition of this property will not meet the requirements for certain tax rules that may allow bona fide residents of those possessions to reduce or obtain a rebate of taxes on income from sources within the relevant possessions.

These rules apply to dispositions after April 11, 2005. For details, see Temporary Regulations section 1.937-2T(f)(1) and Example 2 of section 1.937-2T(k).

Example.

In 2001, Cheryl Jones, a U.S. citizen, lives in the United States and buys 100 shares of stock in the Rose Corporation, a U.S. corporation. In 2004, she moves to Puerto Rico. In 2006, while a bona fide resident of Puerto Rico, Cheryl sells the Rose Corporation stock at a gain. For income tax purposes, this gain is not treated as income from sources within Puerto Rico.

Caution
The new source rules discussed in the preceding paragraphs supplement, and may apply in conjunction with, an existing special rule. This existing special rule applies if you are a U.S. citizen or resident alien who becomes a bona fide resident of American Samoa, the CNMI, or Guam, and who has gain from the disposition of certain U.S. assets during the 10-year period beginning when you became a bona fide resident. The gain is U.S. source income that generally is subject to U.S. tax if the property is either (1) located in the United States; (2) stock issued by a U.S. corporation or a debt obligation of a U.S. person or of the United States, a state (or political subdivision), or the District of Columbia; or (3) property that has a basis in whole or in part by reference to property described in (1) or (2). See chapter 3 for filing requirements.

I can't tell you exactly what this means, but I'll post more if I ever figure it out!

Let

WOW. That confused the heck out of me!!!

Speaking of taxes, does anyone have a good accountant (on STX) out there to recommend?

You can call IRB and get their take on it. I usually speak to Ms richards in stx.773-1040

For a good accountant on STX, try Jim Sheets in C'sted: 773-7510. I use him for my small business. So far, he has been very good, and he has good references. If he doesn't know an answer off-hand, he'll find it. Between him and his colleagues, he can handle accounting, bookkeeping, retirement plans, and maybe more. He answered a lot of mysterious VI questions when I first got started.

Thanks, STXBob!!