12/07/2022
On June 30th, 2022, Article 60 of Act 52-2022 was amended to include Section 1061.25 to the Internal Revenue Code of PR. In summary, Section 1061.25(b)(4) states that cryptocurrencies are considered foreign financial accounts, so they must file an authenticated statement. In addition, Article 70 adds a section to Section 6030.11 to impose a penalty of $10,000 for failure to file the declaration.
Below is a detailed summary of the amendments made to the law:
Section 1061.25. – Foreign Financial Accounts, states that every individual resident of Puerto Rico shall render, under penalty of perjury, a statement authenticated by their written or digital signature, with the information on financial accounts maintained outside of Puerto Rico or the United States in which they maintain a financial interest. The declaration must include:
1. Name of the institution where it is maintained
2. Maximum value in the account during the year
3. Account number
4. Any other information that the Secretary determines through regulations.
Financial accounts, refers to any of the following:
1. Bank accounts, such as savings accounts, checking accounts and term deposit accounts, among others;
2. Securities accounts, such as managed and derivative accounts or other financial instrument accounts;
3. Options or futures contract accounts;
4. Crypto Asset accounts;
5. Insurance policies with a cash value (such as whole-life policies);
6. Accounts in investment companies or any similar account;
7. Any other type of account that the Secretary determines where funds are kept with a financial institution outside of Puerto Rico or the United States or with a person providing similar services to a financial institution.
A resident of Puerto Rico has a financial interest when:
1. You are the record owner of the account
2. When the record owner is an agent, attorney, or any other person acting on their behalf 86
3. The owner of record is a legal entity in which the individual has, directly or indirectly, at least fifty (50) percent of the total shares or participation by vote or value
4. The record owner is a trust for the benefit of the grantor (“grantor trust”)
5. The individual has the authority (individually or with others) to control the disposition of assets held in said account.
The declaration must be filed together with the individual's income tax return, in accordance with Section 1061.16. The Secretary will design the statement provided here. However, the latter may allow through regulations or general publication that the provisions of this section be complied with by filing the form that is submitted to the Government of the United States for the same purpose.
The provisions of this section will not apply to accounts whose maximum value during the taxable year did not exceed ten thousand ($10,000) dollars. Likewise, the Secretary may waive compliance with this section on those instances where more than one individual is required to report the same financial account.
Any individual who does not comply with the provisions of this section shall be subject to the provisions of Section 6030.11.
Any individual required under Section 1061.25 to file the statement provided therein, who voluntarily fails to file said statement within the established term, shall be subject to a penalty of ten thousand ($10,000) dollars. In addition to the civil penalty provided herein, the individual will incur a misdemeanor.
