Permits & Taxes

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DEPARTMENT OF REVENUE AND TAXATION

Gambling Permits. In general, gambling is a misdemeanor under Chapter 64, Title 9, Guam Code Annotated, subject to certain stated exceptions. Section 64.70(b) states one exception. It states that a permit to conduct gambling activities shall be issued by the Director of the Department of Revenue and Taxation if:

The organization, which applies for the permit, has been organized and functioning actively as a nonprofit organization in Guam for no less than two years prior to filling its application.
The promotion and management of such bingo games or lottery (raffle tickets) are confined solely to the qualified members of the sponsoring organization, no member of which can receive remuneration in any form for time or effort devoted to the promotion and management of the bingo games or lottery.
No member of the sponsoring organization shall receive remuneration in any form for time or effort devoted to the promotion ad conduct of the gambling activities.

Income Tax of Political Organizations.

A political organization shall be subject to taxation under this subtitle only to the extent provided in Section 527 of the Guam Territorial Income Tax Law. A political organization shall be considered an organization exempt from income taxes for the purpose of any law that refers to organizations exempt from income taxes.
Taxable income of a political organization is an amount equal to the excess (if any) of the political organizations gross income for the taxable year (excluding exempt function income) over the direct expenses incurred in earning that income.
Form 1120-POL is to be filed by political organizations that have any taxable income. Form 120-POL is to be filed on or before the 15th day of the third month after the end of the taxable year

Income Tax on Donors of Appreciated Property. If a donor contributes appreciated property to a political organization, he is taxed on the difference between the fair market value of the property and its adjusted basis. The transfer is treated as a sale; so if the property is a capital asset, he will receive capital gain treatment. The political organization acquires the donor’s basis plus any gain recognized to the donor. No
loss will be recognized on the transfer.

Gross Receipts Tax. Exempt from gross receipt tax are amounts received as contributions or received from fund raising activities by political candidates, committees, parties, corporations, associations, organizations or funds and which are expended for political campaign purposes and reported to the Guam Election Commission pursuant to the laws of Guam. (Section 19543.1018 of the Government of Guam Code.)

Registration and Filing of Tax Returns. Any political candidate, committee, party, corporation, association, organization or fund which files a Statement of Account with the Guam Election Commission pursuant to Title 3 of the Guam Code Annotated shall not be required to register with the Department of Revenue and taxation nor file any tax returns with the Department of Revenue and Taxation unless liable for the Territorial Income Tax (Section 19114, Title 3 Election, GCA).

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