The Internal Revenue Service (IRS) of the United States added Law 22 of 2012 to its audit campaign to identify individuals who have used the benefits of the statute without complying with the requirements of Code 937 of the Internal Revenue Code granting them enable them to exclude income or be treated as bona fide residents of Puerto Rico.
Law 22 allows US citizens not to pay federal taxes after they move to the island.
According to a newsletter from the law firm Mayer Brown, the IRS campaign also aims to determine whether individuals who claim Code 933 benefits and meet the requirements of Code 937 are improperly claiming ungenerated income in Puerto Rico to avoid pay federal taxes.
The IRS campaign comes after the federal agency produced a report last year highlighting the need for more information from the Treasury Department about taxpayers who claim to have moved to the island and become beneficiaries of Law 22.
Initially, the IRS will address non-compliance through assessments, disclosure and informative letters. At this point, it is not known whether an amnesty program will be offered to individuals and companies seeking to change their tax returns due to the benefits resulting from the interaction of tax breaks from the United States and Puerto Rico, de Mayer Brown says. newsletter.