Why Nouveau Riche Steemsters Should Consider Moving to Puerto Rico

in photography •  2 years ago

Puerto Rico has many problems, some caused by its own irresponsibility and others caused by the irresponsibility of the US Congress.  But, regardless, it's an absolute paradise in many ways, and mainlanders who move there can enjoy some pretty amazing tax benefits in addition to an exotic Latin lifestyle.


Puerto Rico is the only place in the world where US citizens can escape the IRS.  US citizens who are residents of Puerto Rico pay no US federal income taxes on income that is "sourced" to Puerto Rico.  Instead, bona fide Puerto Rican residents pay taxes on such income only to the Puerto Rican government.


The sourcing rules are complex, but a few things are pretty clear.  First, as a general rule, income earned from providing services (e.g., legal services, accounting services, investment advisory services, consulting services, management services, etc.) is sourced to where the provider of such service resides and not to where the customer is located.  So, if you reside in Puerto Rico and provide these or similar services from Puerto Rico to mainlanders, all income you earn for such will be taxed at Puerto Rican rates and not US federal rates. 


Second, while interest and dividends are sourced to where the payer is domicled, capital gains from the sale of intangible assets (like stocks, bonds and cryptocurrencies)  are sourced to where the owner resides.  So, again, legitimate Puerto Rico residents pay no US federal income tax on their capital gains income on the sale of intangibles like Steem.  Instead they pay Puerto Rican income taxes.


And this is where things get interesting.  Because its economy has struggled so desperately over the last decade, Puerto Rico has seen a mass exodus of its population, many of whom were among its most educated and capable residents.  This exodus has compounded the territory's economic problems immensely.  In hopes of reversing this trend, Puerto Rico now offers special tax rates to US mainlanders who will move to Puerto Rico and work from there.  Specifically, Act 20 (which was passed in 2012) taxes "export service income" (income earned by Puerto Rican residents for providing services to mainlanders) at only 4%.  And Act 22, also passed in 2012, taxes interest, dividends and capital gains sourced to Puerto Rico (on qualifying assets) at ZERO percent!  


These favorable rates are guaranteed for 20 years, but they are only available to mainlanders who agree to move to Puerto Rico and establish residency there, and some restrictions apply.  Hundreds of adventurous souls have already made the move and saved millions in taxes.  Given the adventuresome and libertarian temperament of Steemsters in general, I imagine we'll see at least a few nouveau riche Steemsters seize the opportunity in coming months and years.  Might even @ned and @dan be so inclined?  We'll see.  


My family and I spent the summer of 2014 in Puerto Rico in part to determine whether I could effectively work from there.  There were some challenges, but it's definitely doable for us.  We may make the leap in the next few years depending upon how this whole Steem thing works out.  :-)


Anyway, here are some experiences from our visit:


(The view from our Ocean Park house)

We rented a house in Ocean Park, an older but upscale (by Puerto Rican standards) beach-front neighborhood in San Juan.  Ocean Park is adjacent to Condado, the up-and-coming neighborhood in San Juan.  Condado is much like South Beach, Miami was in the middle 1980s--tons of potential and on it's way back.  The above photo was the view from the balcony of our house.  I could definitely tolerate seeing that every evening!


Two blocks from our house was Ocean Park beach:


(Ocean Park beach)

Regulations are much more relaxed in Puerto Rico, or at least not enforced.  Locals sold great food and drink right on the beach (and without a license, I'm sure!).  

(Cindy and Clara visiting beach vendors)

There's a famous guest house on Ocean Park beach called El Numero Uno Guest House.  There's a restaurant there that I highly recommend called Pamela's.  You can dine right on the beach and watch amazing sunsets during dinner.


(Pamela's--dinner on the beach)


(Me and the twins--Logan and Shelton)

Condado was just a mile or two down the beach.  Casinos, restaurants, posh hotels, and some solid nightlife for those who like to get dressed up for a night on the town:

(Night on the town with Cindy aka @steemed-open)


We took several day trips to visit other parts of the Island.  One of my favorites was to Rincon, a tiny town on the western facing part of the island that's world famous for surfing.  Rincon sunsets are just to die for.


(Shelton, Clara, Cindy and Logan at Rincon)

Photo credit:  All photos are my own.  


If you ever get a chance to visit Puerto Rico, or even better move there, I hope you'll seize it.  It's a wonderful island filled with delightful people.  


Best, 


Sean

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I have to admit I didn't know much about Puerto Rico before I saw this video by John Oliver, he explains the situation really well and somehow even makes it funny while still remaining real about it. You should really watch it if you haven't. Really feel for your country.

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I've seen it. He did a great job!

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Liked it

My brother's GF just came back from a week there. Every other day she post on FB " I need to go back to Puerto Rico!" lol I told her to start blogging here to earn enough to go back!

I visited PR once. The people were so warm and friendly and I'm from Canada so I'm an expert on gauging friendliness levels.

Puerto Rico is a peace of paradise and great exactly like your family, I hope you enjoy the summer there and I think it's a good Idea if some whales up-vote my post I will be nouveau riche (sound french) and I will go to Puerto Rico, nice photos man I think you're are pro photographer because I like how you use the light in the photos , thank you for this wonderful dream

@missjessica and I went to Puerto Rico last year and drove all around to take the whole island in for 2 weeks. It was amazing. I can't get over how nice and welcoming all of the islanders were to us. We've even talked about moving there someday as well. The incentives are nice, but really there's something very different about the culture down there and it can only be witnessed in person. We ate in many strangers' home-based restaurants and left feeling like family.

Even if it were only for the music I'd love to go. This post encourages me to do so even more so now. Any specific recommendations as to where would be a great peaceful spiritually endowed location to move to? Thanks for the post. Namaste :)

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Rincon has incredible energy. But it's small and kinda remote. Truthfully, the whole island has a great vibe.

Soy Boricua! (that song) :)

I feee the people in the island can re-invent tourism with Steemit :D

Liked it

I went to San Juan for my buddies bachelor party last year. Old San Juan was really charming. I also had the best pina colada EVER. We all had a great time!

This is a great post, with financial and aesthetic reasons to consider Puerto Rico as a vacation destination or a home. I've lived in Miami and loved it, but never been to PR. I think I need to visit! Thanks for this info and the lovely pics!

I've always wanted to visit Puerto Rico... Everytime I see pictures from those beaches I feel It has so much potential to brighten my life, at least for a while!... very nice pictures there, I can tell you ejoyed it!.. greetings.

It was an interesting post. I guess how this plays out is, everyone flees from the smaller satellite areas that implode first - in order to travel to the TBTF area - which then implodes also, then everyone has to flee back to where they came from again after.

Really!!!! somebody take me there!!!
good picture~
nice place~

Thanks @sean-king
Good info
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The pictures look amazing, i think i would love to move there!