Informative Bulletin From Internal Revenue No. 02-02

Section 1141(n)(2) of the Puerto Rico Internal Revenue Code of 1994, as amended (Code), provides that every employer required to deduct and withhold income tax at source from employee wages, will provide to each such employee a Withholding Statement (Form 499R-2/W-2PR) not later than January 31 of the following year.

The Code further provides that every person engaged in trade or business within Puerto Rico who makes payments with respect to rents, compensations (salaries), benefits, interest, dividends, services rendered, or judicial indemnification, among others, shall file an Informative Return (Forms 480.5, 480.6A and 480.6B) not later than February 28 of the following year.

During the month of July 2002, the Notification to Employers and Withholding Agents - Issuance of Withholding Statements and Informative Returns (Form AS 6134) was sent to employers, public and private corporations, agencies of the state and municipal government, or companies’ representatives (hereinafter withholding agents).

As informed in the Important Notice of October 18, 2002, this year the Department of the Treasury (Department) has implemented a mechanism to file the Withholding Statements and Informative Returns (Forms) through magnetic media or electronic transfer, for those withholding agents who are required to file 15 or more of these Forms. Therefore, only those withholding agents who requested less than 15 Forms will be receiving the same by mail, and this process will be completed no later than December 15, 2002.

Notwithstanding, on November 12, 2002 the Department sent a Notification to all withholding agents, including those required to file less than 15 Forms, assigning the access code to use the Withholding Statements and Informative Returns Program 2002 (Program) developed by the Department. Therefore, all withholding agents have the option to use the Program, even though not required to file the Forms through magnetic media.

The person who will be coming to pick up the Forms, except for Returns, Declarations or Refund Claims Specialists (Specialists) to whom the requirements detailed below apply, must comply with the following requirements:

1. Submit an official letter (in letterhead paper) specifying:

a) Withholding agent’s name.

b) Employer identification number.

c) Amount of Withholding Statements or Informative Returns requested.

d) Name of person authorized to receive the Forms.

2. Show an official identification with photo.

3. Pick up the Forms after December 14, 2002.

Specialists requesting Withholding Statements and Informative Returns must comply with the following requirements:

1. Submit a list of their clients that includes the client’s name, employer identification number and amount of Withholding Statements or Informative Returns requested by each client.

2. Submit the original Form AS 6134 for each client to avoid duplication of the Forms requested.

3. Present a letter signed by each client authorizing the Specialist to request and receive the Forms.

4. Indicate their social security or employer identification number and their Specialist registry number.

5. Present identification with photo of the person authorized to pick up the Forms.

6. Pick up the Forms after December 14, 2002.

The Forms will be distributed in the following locations:

Taxpayer Service Offices:

It is important to clarify that the Tax Returns Processing Bureau and the Taxpayer’s Service Office will not process any Forms application that does not comply with the requirements mentioned above.

To obtain additional information regarding the Program, call (787) 721-2020 extensions 2592, 2593, 2594, 2595, 2596 and 2597.

The provisions of this Informative Bulletin shall be effective immediately.

Cordially,

Juan A. Flores Galarza