Puerto Rico is a beautiful Caribbean island and unincorporated U.S. territory known for its extraordinary beaches, waterfalls, and mountains. More importantly, this charming island offers lucrative tax incentives for business owners and investors. Our founder, Sam Silverman, outlined Act 60’s many enticing benefits in a recent Stock Market Options Trading podcast.

As Sam noted, interest in the Act 60 program has skyrocketed; more and more people are moving to Puerto Rico to benefit from the tax incentives. Act 60 offers a 4% corporate tax rate and a 0% capital gains tax rate for residents of Puerto Rico who live there for at least half the year. Naturally, tax rates in the mainland U.S. are significantly higher than those offered in Puerto Rico under the Act 60 program. Capital gains tax rates in the U.S. range from approximately 20%–40%, and the current corporate tax rate of 21% will possibly increase under the Biden administration.

In light of these enticing opportunities, PRelocate’s mission is to make the relocation process to Puerto Rico easy and efficient, allowing you to reap the benefits of these tax incentives to the full. PRelocate can provide you and your company with invaluable guidance, minimizing the time and the cost of moving to Puerto Rico. We will assist you throughout the application process and make sure that you meet all of the program’s requirements.

If you are interested in qualifying for the 0% capital gains tax rate, keep in mind that the Act 60 program will require you to pay $15,000 in annual fees ($5,000 for filing the required annual report and a donation of $10,000 to qualifying nonprofits). Still, these fees are much less than what investors would typically pay in capital gains taxes in the mainland U.S.

You should also note that the dividends of companies based in the mainland U.S. will not be covered by Act 60. However, you can avoid these taxes by selling your shares and repurchasing them before and after the dividend payout. Additionally, individuals who have lived in Puerto Rico for 10 years or longer only pay a 5% flat rate on capital gains, even if these gains originated in the U.S.

Listen to the full podcast to learn more about Act 60 and how PRelocate can make the relocation process as easy as possible.

Disclaimer: Neither PRelocate, LLC, nor any of its affiliates (together “PRelocate”) are law firms, and this is not legal advice. You should use common sense and rely on your own legal counsel for a formal legal opinion on Puerto Rico’s tax incentives, maintaining bona fide residence in Puerto Rico, and any other issues related to taxes or residency in Puerto Rico. PRelocate does not assume any responsibility for the contents of, or the consequences of using, any version of any real estate or other document templates or any spreadsheets found on our website (together, the “Materials”). Before using any Materials, you should consult with legal counsel licensed to practice in the relevant jurisdiction.