The Ultimate Act 60 Tax Filing Checklist

Meeting your annual filing obligations is the cornerstone of Act 60 compliance. The primary forms include the Puerto Rico individual income tax return (Form 482) and the U.S. income tax return (Form 1040), where you'll elect the Section 933 exclusion. Key deadlines typically fall on April 15th, but extensions can be filed. Beyond these, you must file an annual report with the DDEC by May 31st, detailing your job creation and investment commitments. Missing these deadlines can trigger penalties and jeopardize your grant. Our system cross-references Hacienda and IRS calendars to provide timely alerts, ensuring you're always ahead of schedule. This level of diligence is what sets apart a compliant decree holder from one at risk. Traditional methods often miss the intricate interplay between U.S. and PR filing dates, a gap our technology is designed to close.

Proving you are a bona fide resident of Puerto Rico is non-negotiable and a primary focus of IRS scrutiny, as highlighted in the IRS Campaign 685. Your tax home, physical presence, and closer connections must all point unequivocally to Puerto Rico. Documentation is your primary defense. This includes utility bills, rental agreements or property deeds, local bank statements, and a Puerto Rican driver's license. The 183-day presence test is a baseline, not a guarantee. You must also demonstrate deeper ties, such as family, social, and economic connections to the island. Our review process analyzes over 50 data points to assess the strength of your residency claim, flagging potential weaknesses that could attract an audit. According to the GAO report (GAO-26-107225), insufficient residency proof is a leading cause of non-compliance findings.

Correctly sourcing your income is critical for benefiting from Act 60's 4% corporate tax rate on export services or 0% tax on capital gains. Income must be properly allocated between Puerto Rico and other jurisdictions. This involves a detailed analysis of where services are performed or where assets generating gains are located. For investors, this means meticulous record-keeping for securities, crypto assets, and real estate, distinguishing between pre-move and post-move appreciation. Furthermore, U.S. reporting obligations for foreign financial assets, such as FBAR (FinCEN Form 114) and Form 8938, remain in effect for many Act 60 holders. Our AI is designed to catch subtle sourcing errors and reporting omissions that are often missed by manual reviews, which can lead to significant tax liabilities and penalties.