I was a resident of Silicon Valley in California for more than 10 years.  I was employed in a medical career by day; operated my own businesses by night; managed my rental properties; and invested in blockchain related technology projects such as Bitcoin or Ethereum.

 

While that required a lot of time to manage, as an entrepreneur, I felt it was worthwhile in effort even if time consuming. 


What I didn't realize was that appoximately 55% of the gross income I made from these tireless efforts was going right out the door in taxation. Employment, Federal, State, short and long term capital gains taxes were all eating into any efficiency or success I was striving to achieve.

 

Until I investigated and completed the Act 22 decree process myself, I did not know, that the territory of Puerto Rico provided such taxation relief options. 

 

The opportunity is a soveriegn decree referred to as Act 22, that is issued by the territory of Puerto Rico. Since 1916, the territority has been authorized by US Federal government to determine the taxation on it's resident population and businesses. There are legal and residential presence tests that must be adhered to in order to qualify, but in my opinion, they are all worth pursuing.

 

Self navigation in a territory where Spanish is the primary language and the legal framework for the process is unfamiliar can be daunting. A do-it-yourself decision can also turn out to be very time consuming and expensive.

 

As a consultant firm contracted by your organization, Startup Launchpad, LLC will provide timely guidance from beginning through governmental decision regarding the Act 22 Decree application process. Our services will facilitate connections and advise you as an individual each step of the way. We will connect you with the legal, accounting and governmental professionals that can speed your Act 20 decree application decision. 

 

*Legal, Accounting professional, governmental, agency or other fees associated outside of Startup Launchpad, LLC control are not included in this price. Our company will, however, guide and connect you with all options known to us that are the most price and time efficient.*

 

 

Act 22

Individual Investors Act › Puerto Rico Tax Incentives

On January 17, 2012, Puerto Rico enacted Act No. 22 of 2012, as amended, known as the “Individual Investors Act” (the “Act”). The Act may have profound implications for the continued economic recovery of Puerto Rico. The Act provides tax exemptions to eligible individuals residing in Puerto Rico. To avail from such benefits, an individual needs to become a resident of Puerto Rico and apply for a tax exemption decree.

 

Eligibility

The benefits of Act No. 22, are only available to bona-fide residents of Puerto Rico that were not bona-fide residents of Puerto Rico for the 6-year period preceding the enactment of the Act on January 12, 2012 (“Eligible Individuals”). Generally, a bona-fide resident of Puerto Rico is a person who: (1) is present for at least 183 days during the taxable year in Puerto Rico; (2) does not have a tax home outside of Puerto Rico during the taxable year; and (3) does not have a closer connection to the United States or a foreign country than to Puerto Rico.

 

Tax Exemptions

The Act is designed to primarily attract to Puerto Rico high net worth individuals, empty nesters, retirees who currently relocate to other States and investors from U.S. and other countries. The Act provides the following benefits to new Puerto Rico bona-fide residents on qualified investments:

• 100% tax exemption from Puerto Rico income taxes on
all dividends;
• 100% tax exemption from Puerto Rico income taxes on
all interest; and
• 100% tax exemption from Puerto Rico income taxes on
all short-term and long-term capital gains accrued after
the individual becomes a bona-fide resident of Puerto Rico
(“Puerto Rico Gain”).

 

Built-in Capital Gains

Also, capital gains realized by an Eligible Individual, but accrued before the individual became a bona-fide resident of Puerto Rico (“Non-PR Built–in Gains”), will be subject to preferential Puerto Rico income tax rates. If such gain is realized and recognized within 10 years after the date residence is established in Puerto Rico, it will be taxed at the income tax rate for capital gains applicable for the tax year in which the gain is realized (currently the capital tax rate is 10%) and at a 5% income tax rate if such gain is realized and recognized after said 10-year period. Pursuant to U.S. income tax regulations, U.S. residents moving to Puerto Rico will be subject to federal income taxes on any Non-PR Built-in Gains realized within 10 years after moving.

 

However, Puerto Rico income taxes may be creditable against such federal income tax, and therefore, U.S. residents moving to Puerto Rico and realizing Non-PR Built-in Gains within a 10-year period after moving may only be subject to the excess of U.S. taxes over Puerto Rico taxes on such Non-PR Built-in Gains. In other words, under current law and tax rates, such individuals may only pay income taxes for the Non-PR Built-in Gains in an amount equal to the federal income tax rate imposed on such Non-PR Built-in Gains.

 

Example 1

For example, if stock from a publicly traded company is acquired by a U.S. resident in 2006 for $40 and is worth $100 just before moving to Puerto Rico in 2012, and then it is sold by the Puerto Rico resident on 2018 for $200, the individual will be subject to income taxes for the gain realized on the sale as follows:

 

 

After 10 years of moving from the U.S. to Puerto Rico, the income tax on the Non-PR Built-in Gains will not apply and bona-fide residents of Puerto Rico will only be subject to a 5% Puerto Rico income tax on any portion of the Non-PR Built-in Gain realized after 10 years from moving to Puerto Rico.

 

Example 2

If the stock acquired by the U.S. resident in Example1 is sold by the Puerto Rico resident on 2023 for $200, the individual will be subject to income taxes for the gain realized on the sale as follows:

 

Tax Exemption Decree

To benefit from the Act, the individual investor needs to submit an application with the Office of Industrial Tax Exemption of Puerto Rico to obtain a tax exemption decree, which will provide full detail of tax rates and conditions mandated by the Act and will be considered a contract between the Government of Puerto Rico and the individual investor.

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Full KYC required, ask for details.

Our fee is:

  • $1500 if by credit card, paypal, venmo.
  • 20% discount if by wire transfer ($1200).
  • 25% discount if by Bitcoin ($1125)
  • 30% discount if by Ethereum or most ERC-20 such as DAI or USDC. ($1050) 
  • 35% discount for payment for services if using HEX. ($975)

Guidance through Act 22 Decree

SKU: SLP002
$1,500.00Price
  • Return and Refund policy.

    Services will be rendered to your company upon signature of contract and cleared payment by Corporate credit card, Corporate check,  Bank Wire, BTC, TrueUSD Ethereum, DAI, USDC or HEX tokens received by our firm. Each method in this variety of payment options also may have significant discount available. Be sure of  your terms as purchase.


    As services and advisory information is irretrievable and irrevocable, so too is the payment for access or render of such service. It is for this reason that a return or refund after payment transfer is not authorized. We will strive to provide value throughout the process to your organization. Should disagreement occur, we welcome arbitration through independent, third party arbitration firms based in Puerto Rico.

  • Once the individual investor obtains the tax exemption decree, the benefits granted will be secured during the term of the decree, irrespective of any changes in the applicable Puerto Rico tax laws. The term of the decree will be until December 31, 2035.

San Juan, Puerto Rico, USA

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