What if we were to tell you that there is a place in the US where you would not need to pay any tax on your cryptocurrency earnings? Would you be surprised? Well, get ready to be surprised as Puerto Rico is the tax haven you’re looking for!
Cryptocurrencies are gaining major momentum in 2017. Markets have boomed and many users have invested their money in these markets. However, considering that these investments often lead to big profits – taxation becomes a critical part of the earnings. According to US Laws, users have to pay a capital gains tax of up to 39% depending on whichever tax slab they fall in.
However, those having accounts and businesses set up in Puerto Rico can potentially pay no tax on the earnings made by Cryptocurrencies! The legal status of Puerto Rico, which makes it a US Commonwealth, means that it has relaxed laws compared to the rest of the country. One such law is regarding the capital gains tax, which is 0% in this part of the US.
These laws were passed by the Obama administration in 2012 as Puerto Rico was in major debt and was facing a strong wave of recession back then. Puerto Rico owes 70 Billion USD in debt to various creditors. These two acts that were passed in 2012 are Act 20 and Act 22 which make the region a tax haven for cryptocurrency investors.
Act 22 is the more specific act that states: Investors that move to the island receive the benefit of not paying any tax on their capital gains.
Puerto Rico is likely to become a key location when it comes to cryptocurrency traders – especailly in the years to follow. The way the markets are progressing, it is soon expected that people will begin finding loopholes in taxation and someone is eventually going to come across this way.