Lawmakers Call for IRS Probe into Abuse of Puerto Rico Tax Incentives Making Island Unaffordable
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Democratic House members sent a letter urging the IRS to investigate wealthy Americans illegally taking advantage of Puerto Rico's Act 60 tax incentives.
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Act 60 gives certain Americans moving to Puerto Rico a 100% federal tax exemption on income, interest, dividends and capital gains.
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The IRS said it has identified 100 individuals violating the rules to claim Act 60's tax benefits.
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Lawmakers suggest compliant Act 60 beneficiaries are still displacing Puerto Ricans by speculative real estate investing enabled by the tax savings.
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Advocates worry the tax incentives are making Puerto Rico unaffordable, with housing prices up 36% in 5 years while 41% of residents live in poverty.