# Puerto Rico Residence for US Tax Tax residency rule, Puerto Rico. Page: https://usecountr.com/trackers/tax-pr-937/ ## Summary To be a bona fide resident of Puerto Rico for US federal tax, a US citizen or resident must pass three tests for the tax year. The main way to pass the first one, the presence test, is to be in Puerto Rico on at least 183 days in the year. This is a target to reach, not a limit to stay under. You must also have no tax home outside Puerto Rico and no closer connection to the United States or a foreign country. A bona fide resident can leave Puerto Rico income out of the US return. The Internal Revenue Service (IRS) decides. - Target: At least 183 days in Puerto Rico - Period: The tax year, for most people 1 January to 31 December - A day counts when: You are physically in Puerto Rico at any time during the day - Other tests: No tax home outside Puerto Rico, no closer connection elsewhere - Law: Internal Revenue Code sections 937 and 933, Regulations 1.937-1 - Run by: The Internal Revenue Service (IRS) ## Who it applies to - US citizens who move from a US state to Puerto Rico and want their Puerto Rico income taxed only by Puerto Rico. - Business owners, investors and remote workers who moved to the island for its tax incentives and must prove residence every year. - People born in Puerto Rico who work part of the year in the United States. - Residents of Puerto Rico who travel a lot and need to know how many days away they can afford. - People in the year they move to or from the island, when special rules apply. ## The rule Puerto Rico is a US territory with its own income tax. Under section 933 of the Internal Revenue Code, a person who is a bona fide resident of Puerto Rico for the entire tax year leaves income from Puerto Rico sources out of the US return. Income from outside Puerto Rico and pay for work as an employee of the US government stay taxable by the United States. Bona fide means real, in good faith. Section 937 of the Code and section 1.937-1 of the Treasury Regulations say who is a bona fide resident. You must pass three tests for the tax year: the presence test, the tax home test and the closer connection test. Passing only the day count is not enough. The presence test has five ways in, and you need one. One: you were in Puerto Rico on at least 183 days in the tax year. Two: you were there on at least 549 days in the tax year and the two years before, with at least 60 days in each of the three years. Three: you were in the United States on no more than 90 days in the tax year. Four: you had no more than 3,000 US dollars of earned income from the United States and were in Puerto Rico on more days than in the United States. Five: you had no significant connection to the United States, which means no permanent home there, no voter registration there and no spouse or child under 18 whose main home is there. The tax home test asks that you had no tax home outside Puerto Rico during any part of the year. A tax home is your regular or main place of work, or the place where you regularly live if you have no main place of work. The closer connection test asks that you had no closer connection to the United States or to a foreign country than to Puerto Rico. The IRS compares where your permanent home, family, belongings, bank, driving licence, voter registration and social life are. If your income from the whole world is more than 75,000 US dollars in a year in which you say you became or stopped being a bona fide resident, you must tell the IRS on Form 8898. The penalty for not filing it is 1,000 US dollars. Why it exists: The exclusion in section 933 is valuable, so Congress wanted it to go only to people who really live on the island. Section 937 was added to the Code in 2004. It gives one test for all US territories: a day count, plus two tests about where you work and where your personal ties are, so that the IRS can check a claim of residence against facts. ## Counting the days You count the days you were physically in Puerto Rico during the tax year. Any part of a day counts, so arrival and departure days are days in Puerto Rico. 1. Count each day on which you were in Puerto Rico at any time. A day on which you were in both Puerto Rico and the United States counts as a Puerto Rico day. 2. Add days you were away for qualifying medical treatment for you or for a parent, spouse or child you went with, and days you could not be on the island because of a declared major disaster or a mandatory evacuation order. 3. IRS Publication 570 lets you add up to 30 days of travel outside both Puerto Rico and the United States, if your Puerto Rico days are more than your US days. 4. If the total is 183 or more, you pass the presence test this way. 5. If the total is lower, check the other four ways, starting with the three-year total of 549 days and the 90-day limit on US days. 6. Then check the tax home test and the closer connection test for the whole year. How Countr counts it: Countr counts every day on which it sees you in Puerto Rico between 1 January and 31 December, and any part of a day counts. It shows the count as a goal of 183 days and tells you 14 days before you reach it. The count is simpler than the law in three ways. Countr cannot add the days away that the IRS lets you count: medical treatment, disaster and evacuation days, and the 30 days of travel outside both Puerto Rico and the United States. So it can show fewer days than the IRS would allow. It does not track the other four ways to pass the presence test. And it cannot see your tax home or your personal ties, which are two of the three tests. ## Examples ### A full move with some travel Elena moved from New York to San Juan in 2024. In 2026 she is in Puerto Rico on 215 days, in the United States on 95 days and in Europe on 55 days. She has more than 183 days on the island, so she passes the presence test without any extra rule. Her office and her only home are in San Juan, so the other two tests can also be met. Her Puerto Rico income for 2026 stays out of her US return. ### Short of 183 until the travel days are added Tom runs a business from Dorado. In 2026 he is in Puerto Rico on 170 days, in the United States on 140 days and in Asia and Europe on 55 days. With 170 days he is 13 short. Because his Puerto Rico days are more than his US days, he may count up to 30 of the 55 days abroad as Puerto Rico days. That gives 200 days and he passes. If his US days had been more than his Puerto Rico days, the 30-day rule would not apply and he would fail this way. ### Three years added together Ana is in Puerto Rico on 200 days in 2024, 180 days in 2025 and 169 days in 2026. For 2026 she does not reach 183 days. But the three years add up to 549 days, and she has at least 60 days in each year. She passes the presence test for 2026 through the three-year way. One day less in any of the three years and she would not. ## Exceptions - In the year you move to Puerto Rico you can pass the tax home and closer connection tests by meeting them for the last 183 days of the year only, if you were not a bona fide resident in any of the 3 years before and you are one in each of the 3 years after. - A US citizen who was a bona fide resident for at least 2 years and then moves away can still exclude Puerto Rico income for the part of the last year before the move. - Some days in the United States are not counted as US days: stops of less than 24 hours between two places outside the United States, days as a full-time student, and days serving as an elected or full-time official of the Puerto Rico government. - Qualifying medical treatment means care that needs a night in a hospital or hospice, with the days around it that are medically needed. You must keep a signed statement from the doctor. - The 30 days of travel outside both places cannot be used to reach the 60-day yearly minimum in the 549-day way. - Members of the US armed forces who are away under military orders keep the status they had before. ## Common misconceptions - "183 days on the island makes me a Puerto Rico resident for US tax." It only passes the first of three tests. If your main place of work is in a US state, or your family and home are there, you can have 250 days on the island and still fail. - "A bona fide resident of Puerto Rico pays no US federal tax." Only income from Puerto Rico sources is left out. Income from the United States or from other countries stays on the US return, and so does pay from the US government. - "If I miss 183 days, I have lost the status for that year." There are four other ways to pass the presence test, for example 549 days over three years or no more than 90 days in the United States. - "I can become a bona fide resident in December and exclude that year's income." The exclusion needs bona fide residence for the entire tax year. The year of the move has its own rule with conditions that reach 3 years back and 3 years forward. ## Questions and answers ### Does the day I fly from Miami to San Juan count as a Puerto Rico day? Yes. Any day on which you are in Puerto Rico at any time counts. When you are in both the United States and Puerto Rico on the same day, the day counts for Puerto Rico. ### Do days abroad on holiday hurt my count? Not always. If you spend more days in Puerto Rico than in the United States, up to 30 days of travel outside both can be counted as Puerto Rico days. Days in the United States never count this way. ### Is the 183-day test based on the calendar year? It is based on your tax year. For nearly all individuals that is the calendar year, 1 January to 31 December. ### What if I spend exactly half the year in Puerto Rico in a leap year? The number does not change. You need 183 days in a year with 365 days and in a year with 366 days. ### Do nonresident aliens use the same presence test? No. A person who is not a US citizen or resident uses the Substantial Presence Test with Puerto Rico in place of the United States. The five ways described here are for US citizens and resident aliens. ### Is this the same as being a resident under Puerto Rico's own tax law? No. This page is about the US federal test in section 937. Puerto Rico's tax office applies its own rules for its own income tax, and a person needs to meet both. The same federal test is used for the tracker US Virgin Islands Residence for US Tax. ## Sources - [IRS Publication 570, Tax Guide for Individuals With Income From U.S. Territories, Bona Fide Residence](https://www.irs.gov/publications/p570) - [Internal Revenue Code, 26 U.S.C. section 937, Residence and source rules involving possessions](https://www.law.cornell.edu/uscode/text/26/937) - [Internal Revenue Code, 26 U.S.C. section 933, Income from sources within Puerto Rico](https://www.law.cornell.edu/uscode/text/26/933) - [Treasury Regulations, 26 CFR 1.937-1, Bona fide residency in a possession](https://www.law.cornell.edu/cfr/text/26/1.937-1) --- Countr is an app for iPhone that counts your days in every country for visa, tax and residency rules, from the photos on your phone and your location. It explains rules and counts days. It does not give legal or tax advice. https://apps.apple.com/app/country-days-tracker-countr/id6810720800