Taxes & Law

• Local tax authority: Departamento de Hacienda de Puerto Rico.
• Federal IRS rules also apply for many people — see Pub. 570.
• Tourists without PR income usually file no ongoing Hacienda income return — status and activity matter.
• Double tax / credits: depend on home country and status.

Per Hacienda and Informative Bulletin 15-10, the general IVU is 11.5%: 10.5% Commonwealth + 1% municipal. Imports for use are often 10.5%. Special rates may apply (e.g. 4% on certain B2B/professional services; reduced rates on prepared food).

• IVU appears on receipts.
• Details: Hacienda PR.

Puerto Rico levies its own income tax. Frequently cited progressive brackets for net taxable income (secondary sources/instructions): 0% up to about USD 9,000; then 7%, 14%, 25%; top rate often 33% above about USD 61,500. Adjustments may apply — check current Hacienda tables.

Many tax outcomes require bona fide residence in Puerto Rico. Per IRS (IRC § 937 / Pub. 570): presence test (often ≥ 183 days in the year, with alternatives), no tax home outside PR, and no closer connection to the U.S. or another country than to PR.

• Presence alternatives include 549 days over 3 years (≥ 60/year); ≤ 90 days in the 50 states; or other regulatory tests.
• Form 8898 can apply when establishing/ending territory residency.

Under the Incentives Code (Act 60-2019), qualifying new residents may seek an Individual Resident Investor decree (formerly often “Act 22”). Typical compliance items per DDEC:

• Annual donation of at least USD 10,000 (from the decree’s second tax year) to PR nonprofits; split often USD 5,000 child-poverty orgs, USD 2,500 Social Equality Fund, USD 2,500 other (Act 32-2024) — DDEC Circular 2026-001.
• Annual report fee often ca. USD 5,000 — Please check with the competent authority.
• Purchase of a PR residence within two years as principal home — Please check with the competent authority.
• Benefits (often described as 0% on certain capital gains/interest/dividends) only with a valid decree — Please check with the competent authority.

• Tourist status ≠ tax residence ≠ work authorization.
• Act 60 seekers usually need a lawful stay path first (often U.S. citizen/LPR).
• IVU in daily life; income tax only with taxable status/income.