Insular possessions

An insular area is a territory of the United States of America that is neither a part of one of the fifty U.S. states nor the U.S. federal district of Washington, D.C. Such areas are called "insular" from the Latin word insula ("island") because they were once administered by the War Department's Bureau of Insular Affairs, now the Office of Insular Affairs at the Department of the Interior. The term insular possession is also sometimes used.

Congress has extended citizenship rights by birth to all inhabited territories except American Samoa, and these citizens may vote and run for office in any U.S. jurisdiction in which they are residents. The people of American Samoa are U.S. nationals by place of birth, or they are U.S. citizens by parentage, or naturalization after residing in a State for three months. Nationals are free to move around and seek employment within the United States without immigration restrictions but cannot vote or hold office outside of American Samoa.

Residents of insular areas do not pay U.S. federal income taxes but are required to pay other U.S. federal taxes such as import/export taxes, federal commodity taxes, social security taxes, etc. Individuals working for the federal government pay federal income taxes while all residents are required to pay federal payroll taxes (Social Security and Medicare).

The U.S. State Department uses the term insular area to refer not only to these territories under the sovereignty of the United States, but also those independent nations that have signed a Compact of Free Association with the United States. While these nations participate in many otherwise domestic programs, they are legally distinct from the United States and their inhabitants are not United States citizens or nationals.

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