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Puerto Rico Tax Law Questions & Answers
1 Answer | Asked in Real Estate Law, Tax Law and Civil Litigation for Puerto Rico on
Q: I am currently being sued by my ex regarding my half of my apartment in Puerto Rico. My ex is claiming that I abandoned

the property and demanding that I pay for her lawyers' fees. This is not a divorce case. We own a condominium apartment and this is our first home together. We have owned the property for a year now. I paid more than half of the apartment cost, yet we still own it 50/50. I left said property... View More

James L. Arrasmith
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answered on Mar 26, 2024

When you decide to donate your half of the property in Puerto Rico to your ex, there could be tax implications depending on the value of the property and the laws in place. In Puerto Rico, the donation of real estate is subject to the payment of a donation tax unless specific exemptions apply. This... View More

1 Answer | Asked in Tax Law and Real Estate Law for Puerto Rico on
Q: Can I switch name of ownership on a house that has taxes still owed?

My dad passed away in 2015 he has a house in PR that me and my mother have been keeping up with and we would like to sell it but we first have to switch it over to our name can we do that while taxes are still unpaid?

James L. Arrasmith
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answered on Mar 13, 2024

Transferring ownership of a property with unpaid taxes can be complicated and may vary depending on the specific laws and regulations of Puerto Rico. However, in general, under federal law, it is possible to transfer ownership of a property even if there are outstanding property taxes owed. That... View More

1 Answer | Asked in Tax Law for Puerto Rico on
Q: mom & stepdad pass and left a property & I was wondering if my stepbrother buys me out do I have to pay capital gain tax

they had no will.

James L. Arrasmith
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answered on Mar 4, 2024

When a property is inherited due to the passing of relatives and you are considering selling your share to a stepbrother, understanding the tax implications is important. If they passed away without a will, typically, the property's ownership would be determined by the state's intestacy... View More

1 Answer | Asked in Estate Planning, Real Estate Law and Tax Law for Puerto Rico on
Q: Can we renounce this property to CRIM so it doesn’t pass on to our children when we pass?

My sister & I are declared heirs & paying taxes to CRIM since our mom’s passing in 2016, but 1 of the properties (land only) is not registered in our name at Prop. of Registry. It’s registered to our grandfather for more than 100 yrs. It was an unresolved matter for mom to register it... View More

James L. Arrasmith
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answered on Mar 2, 2024

In Puerto Rico, dealing with inheritance and property taxes involves navigating a complex legal landscape, especially when property titles and registrations involve unresolved issues from past generations. If you and your sister are considering not passing a specific piece of land to your children... View More

1 Answer | Asked in Real Estate Law and Tax Law for Puerto Rico on
Q: For a property in PR, which amount is subject to taxation for a resident of the US who inherited it when sold?

Ex. - Juan's mother dies in 2020. Juan inherits this property at this time. He is going to sell it in 2023 for 200K. Is 200K the taxable amount, or is the taxable amount a percentage of the appreciating value between 2020-2023? (Step up basis)

James L. Arrasmith
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answered on Dec 25, 2023

When Juan inherited the property in Puerto Rico in 2020, the basis of the property for tax purposes would typically be the fair market value at the time of inheritance. This is known as a "step-up" in basis. When he sells the property in 2023 for $200K, the taxable amount would generally... View More

1 Answer | Asked in Tax Law, Municipal Law and Probate for Puerto Rico on
Q: We have several problems here involving renouncing inheritance, segregation, and property tax status.

How do you renounce inheritance in Puerto Rico and find out property tax status (have the taxes been paid)? Also, if we renounce inheritance, can we shift the property to a relative who lives there? We live in the United States.

James L. Arrasmith
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answered on Nov 19, 2023

To renounce an inheritance in Puerto Rico, you must formally declare your intention to do so within a specific timeframe, usually within nine months of the decedent's death. This declaration is made before a notary in Puerto Rico. It's a definitive decision, meaning once you renounce, you... View More

1 Answer | Asked in Tax Law and Real Estate Law for Puerto Rico on
Q: My dad wants to donated his house to me and my 2 sibling are in agreement. Do I have to pay any kind of taxes?

The house is located in Puerto Rico.

Rafael  Pagan-Colon
Rafael Pagan-Colon
answered on Oct 24, 2023

Any real estate property located in Puerto Rico that does not constitute your primary residence is subject to property taxes. If the property currently belongs to your father and is his primary residence, he may have requested a tax exemption from the Municipal Income Collections Center... View More

2 Answers | Asked in Real Estate Law and Tax Law for Puerto Rico on
Q: My mother transferred 2 properties in my name as a living inheritance. Is there any way that I can avoid paying any tax

She still lives in Puerto Rico, and I would like to build her a home on a different property that my brother owns and would like to use some of the monies for the build would I still pay a capital gains tax?

Samuel  Landis
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answered on Jul 17, 2023

There are a variety ways to address the tax issues described above. If your mother passes, then there may be an exemption from taxes called the Unified Credit. If she wishes to transfer the properties to you during her lifetime without a taxable consequence, then she may need to file a gift tax... View More

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2 Answers | Asked in Real Estate Law and Tax Law for Puerto Rico on
Q: My mother transferred 2 properties in my name as a living inheritance. Is there any way that I can avoid paying any tax

She still lives in Puerto Rico, and I would like to build her a home on a different property that my brother owns and would like to use some of the monies for the build would I still pay a capital gains tax?

Rafael  Pagan-Colon
Rafael Pagan-Colon
answered on Jul 15, 2023

Unless either real estate property is your primary residence, you'll be paying property taxes. Furthermore, if you reside outside Puerto Rico, the sale of either or both real estate properties will be subject to a 15% retention of the sales proceeds, which will be deposited with the Puerto... View More

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1 Answer | Asked in Real Estate Law and Tax Law for Puerto Rico on
Q: What do I need to file a CAMBIO de DUEÑOS, and how can I obtain a copy of the Segregation Deed pertaining to property ?

I am in the process of filing for a change of ownership for a property that was left to me by my father prior to his passing. the Escrituras for myself and 2 other siblings were completed years ago, the land was segregated into three parts, in each of our names. Recently, one of my siblings filed a... View More

Rafael  Pagan-Colon
Rafael Pagan-Colon
answered on Jul 6, 2023

Your first step would be to procure a registry certification from the Puerto Rico Property Registry. If the segregation was filed with the Registry, the original lot (finca) will identify the three lots. You do not state whether your late father left his will or whether he died intestate. If a will... View More

1 Answer | Asked in Real Estate Law and Tax Law for Puerto Rico on
Q: My mother inherited land in Puerto Rico in 1991. She is currently a resident of NY and in assisted living .

As my mothers sole heir, if she passes, will I be subject to inheritance taxes on the land? I have read that inheritance tax on land can range from 18%- 50% of the value.

Rafael  Pagan-Colon
Rafael Pagan-Colon
answered on Apr 6, 2023

At this time, the Commonwealth of Puerto Rico does not impose inheritance per se. Nevertheless, property taxes are another matter entirely. Assuming that she lived the real estate property in Puerto Rico until her death, and assuming that no descendant has lived the real estate property since,... View More

1 Answer | Asked in Land Use & Zoning, Real Estate Law and Tax Law for Puerto Rico on
Q: What Office can verify the assigned numbers that corresponds with each part of the property and was it segregated, OPGE

the property in question should have been segregated according to our ‘records’ back when they were originally filed by my father. There appears to be a sequence of numbers that corresponds with each one of the assigned land parcels. Could the OPGe assist with clarifying if the land was... View More

Rafael  Pagan-Colon
Rafael Pagan-Colon
answered on Apr 3, 2023

You'll have a better chance to get the information from the Property Registry. When lad plots are segregated from a main lot, the Registrar annotates each of the new property ("fincas") numbers for each of the newly segregated land plots on the margin of the main lot. Also identified... View More

2 Answers | Asked in Real Estate Law and Tax Law for Puerto Rico on
Q: Can I submit these documents on the portal of the CRIM to request a change of ownership? & request these permits OPGe?

I did the claim de Herrederos after my father passed and I think a ‘Plano de certification y mensura’ may have been done on the property when it was surveyed by an engineer and whole description was filed with the paperwork. Unless it is a separate or different process? don’t know if that... View More

Ramon  Olivencia
Ramon Olivencia
answered on Mar 24, 2023

Your description contains confusing information about the multiple steps required for an inheritance to be correctly transferred to the heirs. Given the specialized nature of estate law in Puerto Rico, hiring an attorney to do this for you is highly recommended. If everything is correct, a licensed... View More

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1 Answer | Asked in Real Estate Law and Tax Law for Puerto Rico on
Q: Where would I file the Request for the transfer of ownership? can this be done online? Where are original records kept?

Assuming that most of the process should have been already done, where would I go to find the measurements of the plot? I had the land surveyed when we started the process back in 2007 when my father passed.I’m pretty sure I have most of these documents. The only thing I don’t have is the title... View More

Rafael  Pagan-Colon
Rafael Pagan-Colon
answered on Mar 23, 2023

Ownership of the property can be established by requesting a registry certification from the Puerto Rico Property Registry (Registro de la Propiedad) with copy of the scanned foils that shows the historical tract of the real estate property. You can physically visit the Registry located in the... View More

1 Answer | Asked in Estate Planning, Real Estate Law, Tax Law and Probate for Puerto Rico on
Q: My mom wants to gift her PR home to me (her only heir). What tax/other issues should I be aware of?

My mother is a PR resident (I am not), and wants to gift her home to me before she remarries or dies. She also said she may want to still live in the home after she gifts it to me. She said she would gift the title, but still have it enscribed in her name. I want to accept her kind gift, but I am... View More

Rafael  Pagan-Colon
Rafael Pagan-Colon
answered on Jul 18, 2022

First off, unless your mother donates the property to you by way of a deed the Property Registry would still register the real estate in her name. Once she transfers the property in fee simple to you, it needs to be inscribed in your name by filing a certified copy of the donation deed and of your... View More

1 Answer | Asked in Tax Law and Real Estate Law for Puerto Rico on
Q: Does one have to pay federal taxes on the sale of land or property in PR? Specifically on inherited property?

CRIM tells me that the only name on their listing is my father’s therefore my sisters and I are the only heirs. Someone wants to buy the property ( cash sale), according to them once we have the declaration of heirs the property is transferred and there are no closing cost or taxes to be pay on... View More

Rafael  Pagan-Colon
Rafael Pagan-Colon
answered on Mar 21, 2022

What you say is not entirely correct.

As a rule, there is no inheritance tax applied. Once the declaration of heirs has been issued by the Puerto Rico courts, you need to procure a certification of value and a certification of debt from CRIM. With these certifications and a copy of the...
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1 Answer | Asked in Estate Planning, Tax Law and Probate for Puerto Rico on
Q: mom died in PR now my brother is ordering me to give him my inheritance portion prior to distribution w/o documentation

I am being ordered to fly from California to NY to sign documents and turn over my portion of the inheritance to him/them. I have asked for documentation repeatedly and he refuses to give me anything not even verbal information about the matter and now he is threatening to abandoned my father, not... View More

Rafael  Pagan-Colon
Rafael Pagan-Colon
answered on Sep 6, 2021

First off, blackmailing you into resigning your inheritance is illegal. If your siblings have denied you access to documentation pertaining to your mother's estate (assuming that she died in Puerto Rico), you have the right to request said documents through the Puerto Rico Courts, by way if an... View More

1 Answer | Asked in Real Estate Law, Tax Law and Land Use & Zoning for Puerto Rico on
Q: If a sibling passes prior to parent, are their children entitled to Puerto Rico land inheritance(1/3 law) under PR law?

My mother/aunt-in-law wish to sign over their mothers property in PR to my wife. I have several questions:

1) Their brother died prior to her grandmother, but he had children. Do they have a claim to the property? 2) I am unsure if anyone took care of the inheritance tax, as seen on... View More

Nelson Jose Francisco Alvarez-Aponte
Nelson Jose Francisco Alvarez-Aponte
answered on Jul 3, 2020

Hello and thank you for using Justia. First off, I thank you for your services to the Armed Forces.

1) The Grand Mother is the "Causante" thus an Estate has to be created in her name. The members of the Estate are your Mother in Law, Aunt in Law and your deceased Uncle in Law. The...
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1 Answer | Asked in Estate Planning, Real Estate Law and Tax Law for Puerto Rico on
Q: Mom passed in 2005, she owned lots of land and buildings. No Inheritance Tax Return was ever filed.

Is there a tax with interest and penalty due. Value of Estate is around $4m. There has been 3 bad lawyers involved and internal as well as external fighting that has now lasted 17yrs from DOD. I am very concerned about potential liabilities. All born in PR, 3 live in USA and 1 still lives in P.R..

Nelson Jose Francisco Alvarez-Aponte
Nelson Jose Francisco Alvarez-Aponte
answered on Jun 8, 2020

Hello and thank you for using Justia. Very sorry to read that you have had horrible expirience with the prior three Attornys.

An Inheritance Tax Return must be filed as soon as possible. There will be a Tax liability on the value of the Estate plus penalties and ingrest fees. In addition...
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1 Answer | Asked in Real Estate Law and Tax Law for Puerto Rico on
Q: How do squters get their power and water turned on with out owning the deed to a property.
Nelson Jose Francisco Alvarez-Aponte
Nelson Jose Francisco Alvarez-Aponte
answered on Apr 19, 2020

Hello and thank you for using Justia. Usually a sworn Declaration stating that they are the residents of said property will allow them to get public utilities connected.

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