Puerto Rico's Act 60 tax incentive program has become one of the most significant drivers of luxury real estate demand on the island. Since its restructuring in 2019, Act 60 has attracted thousands of high-income individuals, investors, and entrepreneurs who have relocated to Puerto Rico — and with them has come sustained demand for high-quality housing in San Juan's premium neighborhoods.
If you are considering a move to Puerto Rico under Act 60, or if you are evaluating real estate as part of your relocation planning, this guide will give you the foundation you need.
What Is Act 60?
Act 60 — formally the Puerto Rico Incentives Code — consolidates several earlier incentive programs, including the well-known Act 20 (Export Services) and Act 22 (Individual Investors). It offers qualifying residents a dramatically reduced tax burden on certain categories of income earned while living on the island.
The two components most relevant to real estate buyers are:
Chapter 2 (formerly Act 22) — Individual Investors: Qualifying individuals pay 0% Puerto Rico tax on dividends, interest, and capital gains accrued after becoming a bona fide resident of Puerto Rico. This is the incentive that draws investors, traders, and entrepreneurs who derive income from capital rather than active services.
Chapter 3 (formerly Act 20) — Export Services: Qualifying businesses that export services from Puerto Rico pay a flat 4% corporate tax rate. This attracts consultants, fund managers, attorneys, tech founders, and others whose clients or customers are primarily located outside Puerto Rico.
The Residency Requirement
Act 60 benefits are only available to bona fide residents of Puerto Rico. The IRS and Puerto Rico government take residency seriously, and the requirements are substantive — this is not a program you can participate in while spending most of your time elsewhere.
To qualify as a bona fide resident, you must generally: spend at least 183 days per year in Puerto Rico; demonstrate that Puerto Rico is your "tax home" and "closer connection" jurisdiction; establish a permanent home on the island (ownership or long-term rental); and take steps to integrate into the community such as obtaining a driver's license, registering to vote, and opening local bank accounts.
The real estate component of this is significant: you must have a genuine primary residence in Puerto Rico. Many Act 60 residents purchase rather than rent, both to satisfy the residency requirement more conclusively and to participate in the island's real estate appreciation.
What This Means for the Real Estate Market
Act 60 has fundamentally changed the demand profile for luxury real estate in San Juan. The program has brought a large population of financially sophisticated, high-net-worth buyers to the island, and they concentrate in a relatively small number of neighborhoods.
Condado is the primary beneficiary. Its walkability, luxury inventory, and proximity to fine dining and services make it the first choice for many Act 60 residents. Demand from this cohort has contributed to rising prices and a premium rental market for well-appointed units.
Ocean Park, Miramar, and Isla Verde are secondary concentrations, each offering slightly different lifestyles at varying price points.
What to Look for in an Act 60 Real Estate Purchase
If you are buying primarily to establish Act 60 residency, your property needs to function as a genuine primary residence — not a vacation home or investment property. This means choosing a neighborhood where you will actually want to live, selecting a building and unit that reflects how you intend to spend your time, and ensuring the property can serve as your demonstrable permanent home if you face an IRS residency audit.
At the same time, the investment fundamentals matter. Properties in Act 60-dense neighborhoods hold value well and have strong appreciation histories. Choosing wisely at the outset protects both your residency status and your financial position.
Working With an Agent Who Understands Act 60
The Act 60 real estate transaction has nuances that a generalist agent may miss. At Alexandra Amador Boutique Real Estate, we work regularly with Act 60 buyers and understand the intersection of residency requirements, lifestyle needs, and investment objectives that defines this client profile. We coordinate closely with Act 60 attorneys and tax advisors to ensure your purchase is properly structured.
Contact us to speak with our team about buying under Act 60 in Puerto Rico.