Puerto Rico's Treasury Department (PRTD) has issued guidance (Circular Letter (CL) 18-04) on electronic filing (e-filing) of extensions of time to file income tax returns for tax year 2017.

Extension of time to file the income tax return

For tax year 2017, Form SC 2644, Request for Extension of Time to File the Income Tax Return, must be filed electronically unless one of the following exceptions apply:

• An individual taxpayer cannot file electronically because of a social security number error or it is the individual's first time filing.
• The system does not allow a corporation or limited liability company to file electronically because of an employer identification number error or tax period error.

In those cases, taxpayers must file Form SC 2644 on paper. With Form SC 2644, individual taxpayers must file Form 483.2, Exception to Electronically Filing the Individual Income Tax Return.

Taxpayers who meet one of these exceptions must file paper Form SC 2644 by mail to:

Treasury Department
P.O. Box 9022501
San Juan, PR 00902–2501

They also may file the form in person at any of the following locations:

• Treasury Department, 10 Covadonga Road, Mayor Ramírez Building, Old San Juan
• Internal Revenue Collection offices
• Orientation and Return Preparation Centers, only available until 17 April 2018

Additionally, taxpayers who are not required to file electronically have the option of filing Form SC 2644 electronically through the PRTD's website, "Colecturia Virtual" (www.hacienda.pr.gov).

CL 18-04 provides step-by-step instructions for electronically filing Form SC 2644.

Additional extension of time to file

Individual taxpayers who are outside of Puerto Rico when the return, as extended, is due may request an additional extension of time to file their income tax returns by completing Parts I and IV of Form SC 2644 and filing in-person or by mail at the locations previously indicated.

With the request, the taxpayer must include evidence that the taxpayer is outside of Puerto Rico (e.g., a flight confirmation, a copy of photo identification that shows the place of residence outside of Puerto Rico).

Implications

Companies with operations in Puerto Rico that have been filing their automatic extension requests on paper should note this change and coordinate with their tax departments and tax service providers to ensure compliance with CL 18-04.

The extension only applies to the filing of the return, not the payment of any balance due. The balance due can be paid electronically at the time of filing the extension using the ACH debit method or with a credit card. Otherwise, it can be paid with cash, credit card, check or money order payable to the Secretary of the Treasury at any of the PRTD's Collector Offices. Even though not mentioned in CL 18-04, payment can also be sent by mail. If payment is made in person or by mail, it is important to accompany the payment with a copy of the extension filed electronically.

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CONTACTS

For additional information with respect to this Alert, please contact the following:

Ernst & Young Puerto Rico LLC, State and Local Taxation Group, San Juan

• Rosa M. Rodríguez
  rosa.rodriguez@ey.com
• Pablo Hymovitz Cardona
  pablo.hymovitz@ey.com
• María T. Riollano
  maria.riollano@ey.com

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