A Defensive Guide to Your First Year of Act 60 Tax Compliance

From your first day in Puerto Rico, every action must be taken with the assumption of future scrutiny. This means creating a detailed, contemporaneous record of your bona fide residency—far beyond simply counting 183 days. It involves establishing a clear tax home and severing primary connections to your former jurisdiction, as outlined in the Closer Connection Test. Act 60 Shield is designed to stress-test your residency proofs against the rigorous standards used by auditors. While traditional advisors may offer guidance, our system is built to identify the specific weaknesses that could be exploited during an audit, providing a layer of defense that is essential in today's heightened enforcement environment.

Your inaugural tax filing under Act 60 is a critical defensive document. It must be flawless. Common errors, such as misallocating income from pre-move asset appreciation or incorrectly sourcing revenue from consulting services, can create vulnerabilities. The GAO report (GAO-26-107225) has already put a spotlight on reporting discrepancies, giving auditors a clear roadmap. Our review process is engineered to view your filing through the lens of an examiner. We help identify and remediate potential red flags before you file, ensuring your return presents a coherent and defensible narrative that aligns with both Puerto Rico's tax code and stringent IRC requirements.

In the complex world of Act 60, ignorance is not a defense. Failing to file a required U.S. informational return, like Form 5471 for foreign corporations or FBAR for foreign bank accounts, can result in severe, non-negotiable penalties. These are the tripwires that auditors look for. Given the underserved nature of the digital compliance market, many new decree holders are unknowingly exposed. Act 60 Shield was built to close this gap. We provide a focused review designed to neutralize these common threats, ensuring your compliance strategy is robust and your assets are protected. For those who take compliance seriously, it's the essential first step in building a long-term defensive shield.