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Tony is going on a little trip this month and boy oh boy is he excited! His sister, Toni (ya, I know), has been living down in Puerto Rico and Tony is finally going to see her new place. He told me all about his trip and how he’s preparing – bought a new bathing suit, found his sunglasses, ordered some sunscreen, pulled a few things from his summer clothes out of storage, and renewed his passport. This gave me pause. First of all, sunscreen and sunglasses can, and should, be used year-round – UV rays don’t go away in winter. Secondly, you don’t need a passport to go to Puerto Rico, Tony, it’s a U.S. Territory. Lastly, add your phone to your checklist so TaxBird logs the days out of New York – we don’t want another issue with statutory residency this year!
When we think of the United States, we too often think only of the 50 states. But the U.S. also has territories and residents there who are U.S. citizens or U.S. nationals. Let’s take a closer look and see if we can teach Tony a thing or two about Puerto Rico and the rest of the territories.
First things first, what are the territories of the United States? Currently, there are 16 territories, and, of those, there are 5 that are permanently inhabited and likely the ones that you’re familiar with.
The 5 more well-known and permanently inhabited territories are:
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Puerto Rico
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Guam
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Northern Mariana Islands
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American Samoa
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U.S. Virgin Islands
The remaining uninhabited territories include:
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Midway Atoll
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Palmyra Atoll
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Baker Island
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Howland Island
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Jarvis Island
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Johnston Atoll
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Kingman Reef
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Wake Island
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Navassa Island
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Serranilla Bank
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Bajo Nuevo Bank
Okay, now that we can picture these islands, how is a territory defined? For this blog, let’s just focus on the 5 better known territories. The U.S. Citizenship and Immigration Services describe a territory as:
A partially self-governing piece of land under the authority of the U.S. government. U.S. territories are not states, but they do have representation in Congress. Each territory is allowed to send a delegate to the House of Representatives. The people who live in American Samoa are considered U.S. nationals; the people in the other four territories are U.S. citizens. Citizens of the territories can vote in primary elections for president, but they cannot vote in the general elections for president.
A territory can fall under a few different classifications based on two factors, incorporation and organization. A territory is incorporated if the U.S. Constitution is in effect there, with the exception of those parts reserved for a state. An incorporated territory is considered an integral part of the United States. The 5 main territories are not incorporated, the last two territories with this status were Hawaii and Alaska before they became states. A territory is organized if they have passed an Organic Act through Congress that establishes how the territory will be governed. Although all 5 territories have established a government, the American Samoa is not considered organized, but the rest are.
The unincorporated, organized territories are Puerto Rico, Guam, United States Virgin Islands, and Northern Mariana Islands. The residents of these territories are full U.S. citizens and pay federal taxes like Social Security and Medicare and can travel freely within the U.S. (and Tony can freely travel there). They do not pay federal income tax as long as they spend 183 days in their territory, have a tax home there, and do not have closer ties to another state in the U.S. or a foreign country. As stated above, these citizens can only vote in primary elections for President, not in the general election. They have a representative in congress, but their representative is not allowed to vote on the floor, only in committee.
That leaves the American Samoa as an unincorporated, unorganized territory. The residents here are U.S. nationals and they are not granted full citizenship unless they apply for it. American Samoans need a passport to visit the U.S. And who issues the passport? Interestingly enough, it’s issued by the U.S. so they need a U.S. non-citizen passport to visit the rest of the U.S. They have the same representation and voting rights as the organized territories.
When looking at the size of these territories relative to the states, they are quite small in both area and population with the exception of Puerto Rico. The U.S Virgin Islands, American Samoa, and Guam are very small islands. The U.S. Virgin Islands is the largest of those three and it is still only about half the area of Rhode Island. The Northern Mariana Islands are the next largest and they’re about mid-way between Delaware and Rhode Island in area. Puerto Rico is the largest and is roughly the same area as Connecticut. In terms of populations, Guam, American Samoa, the U.S. Virgin Islands, and the Northern Mariana Islands could combine their populations and there would still be fewer people than the least populated U.S. state, Wyoming. Puerto Rico, on the other hand, is quite a bit bigger. There are over 3 million U.S. citizens (including Toni, Tony’s sister) on the island which would have made them 29th for population according to the 2010 census data.
Now I know what Tony is going to be wondering - will we see another state added from these territories? Right now, this seems unlikely. Based on the status, size, and population, Puerto Rico would have the best chance but that is a fairly new thought for the islands. According to everything-everywhere.com, 2012 is the first time that the referendum for Puerto Rico to join the U.S. had received the majority of votes in favor of the idea. However, even with support for becoming a state, their path forward is far from clear on this front, as covered by Vox here. There is no established process to become a state so there is likely quite a bit to work out.
Hope this helps, Tony! Enjoy your time with Toni and leave your passport at home.
Questions, comments, feedback? jared@ware2now.com
More great information at:
https://www.npr.org/2017/10/13/557500279/what-does-being-a-u-s-territory-mean-for-puerto-rico
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