A report from Bloomberg held on June 12 stated that civil and criminal cases are being built against crypto traders, managers, and other wealthy Americans who might have lied about their residence and key elements of income.
The IRS is investigating fund managers and crypto traders from the US who are alleged to be taking false benefits of Puerto Rico’s tax laws. As per 2012 laws, Puerto Rico introduced a new tax regime due to which more than 5000 Americans shifted for liberal tax benefits.
Puerto Rico’s tax policy stated that it would grant them 100% release on dividends, 60% release on municipal tax, and zero federal taxes on the primary income earned within the region.
In a conversation with a U.S. federal prosecutor, notable lawyer Carlos Ortiz said “The noose is tightening” for the wealthy American residents for misusing tax benefits.
Over 3600 businesses have been avoiding paying taxes from income and pay only 4% taxes on exports with no external charges and that benefit attracted more.
As tax benefits here are most relaxed in Puerto Rico but acquiring benefits is much harder. To qualify for tax benefits, a resident must be there for at least 183 days a year showing they have a “closer connection” with Puerto Rico than the US, and call that their “tax home”.
Gold bug Peter Schiff and crypto investor Michael Terpin relocated to Puerto Rico for liberal tax benefits. This July 4, Peter Schiff’s bank got ceased for not matching net income guidelines.
At Miami’s annual Bitcoin Conference on May 18 Terpin appreciating Puerto Rico tax laws said “I’ve been told that every single person is going to get audited, and that’s fine. I keep incredibly precise notes. I get them run past both a tax lawyer and a CPA, and I’ve got two bookkeepers. So bring it on, I’m not afraid of an audit.”
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