Commonwealth of the Northern Mariana Islands

Code section 7654 and 48 U.S.C. section 1681 (P.L. 94-241, section 703(b)) provide that the U.S. Government is required to cover over to the Treasury of the CNMI the federal income taxes withheld on amounts paid to military and civilian employees and pensioners who are residents of the CNMI. The effect of these provisions is that the federal government transfers on at least an annual basis the federal income taxes withheld or collected from its employees and pensioners who are residents of the CNMI to the CNMI Treasury. In order for the federal government to cover over these federal income taxes as required by law, federal agencies must certify the amount of federal income taxes withheld or collected from its employees and pensioners by following the procedures discussed under Certification Procedures , later in this section. As discussed in the Caution next, federal agencies aren’t required to certify the amount of local CNMI taxes that are withheld or collected.