Puerto Rico Income Tax
for Individuals
Puerto Rico Income Tax Residency Test
Puerto Rico income tax rules apply to individuals who meet the residency requirements under the bona fide presence test. Puerto Rico residents, whether U.S. citizens or foreign individuals, may be considered bona fide residents if they spend 183 days or more during the calendar year in Puerto Rico. However, residency for tax purposes is determined by more than physical presence and should be evaluated carefully. If you are considered a resident, you’re generally required to file a Puerto Rico income tax return (Form 482) by April 15. Understanding your obligations—both locally and federally—is key to staying compliant and avoiding penalties.
Puerto Rico Income Tax Filing Requirements
Puerto Rico Return: Residents generally must file Form 482 by April 15. Tax rates on individual income reach up to 33%.
Informative Return Reporting: Starting in 2020, a significant class of business-related expenses became non-deductible unless properly reported on annual informative returns; this applies to both sole proprietors and entities.
U.S. Federal Return (when required):
Bona fide Puerto Rico residents are generally exempt from U.S. federal income tax on Puerto Rico-source income.
A U.S. return (Form 1040, 1040-SS, or 1040-PR) is required if:
The individual earns U.S.-source income above federal filing thresholds.
The individual has self-employment income subject to Social Security/Medicare taxes.
The taxpayer is a U.S. government employee (required to report all government wages).
The individual is claiming the Child Tax Credit (CTC).
Special Cases
- U.S. Government Employees: Must report all U.S. government wages (even those earned in Puerto Rico) on a federal return.
Military Members and Civilian Spouses: Special residency and filing rules may apply under the Servicemembers Civil Relief Act.
Child Tax Credit (CTC): Residents must file Form 1040-SS or 1040-PR to claim CTC, subject to qualifying child and income rules, including limits for child-earned income.
See also: Form 8898 Requirements for individuals relocating to or from Puerto Rico.
FAQ
It depends on your income sources and residency status. Some Puerto Rico residents must file with the IRS if they have U.S.-source income.
Generally no, but U.S. government wages and income earned outside of Puerto Rico may be federally taxable.
Need help meeting your filing obligations? Use the form below to describe your tax situation, and we’ll help you determine what applies.