Act 60 Requirements: Who Qualifies (and Who Doesn't)
To qualify for Act 60's individual investor decree you must be a new resident of Puerto Rico— someone who wasn't a bona fide resident during the statutory lookback period — and then actually establish and maintain bona fide residency, buy a home within two years, and meet annual donation and filing obligations. The rules are objective, which means eligibility can usually be determined in minutes.
Requirement 1: You must be a new resident (the lookback)
The core gate is prior residency history. Applicants cannot have been bona fide residents of Puerto Rico during the lookback period before applying:
- Applications filed through December 31, 2026: the current-law lookback of 10 years.
- Applications filed after December 31, 2026: a 6-year lookback under the 2026 amendments.
"Bona fide resident" here carries its tax meaning — someone who merely vacationed in Puerto Rico, or lived there only as a child decades ago, is typically not disqualified. Borderline histories (past student years, family stints, part-year moves) are exactly what the eligibility review is for.
Requirement 2: Establish bona fide residency — the three IRS tests
The decree only produces its benefit if you satisfy IRS Publication 570's three tests, every year:
- Presence test — most commonly at least 183 days physically in Puerto Rico during the tax year. Alternate ways to satisfy it, day-counting mechanics, and the year-of-move rule: the 183-day rule.
- Tax home test — your regular or principal place of business/employment (or abode, if none) must be in Puerto Rico.
- Closer connection test— your center of life must be Puerto Rico, judged on facts: home, family, banking, driver's license, voter registration, organizations. Full breakdown: bona fide residency.
Requirement 3: Decree conditions
Beyond residency, the decree itself imposes:
| Condition | Detail |
|---|---|
| Home purchase | Residential property in Puerto Rico within 2 years of the decree grant, used as your principal residence. Post-2026 decrees add a property-registry recording requirement. |
| Annual donation | $10,000/year to qualified PR nonprofits — $5,000 to organizations on the CECFL list and $5,000 to Hacienda-qualified nonprofits, completed by December 31. |
| Annual compliance | DDEC annual report, $5,000 annual fee, and supporting documentation including residency logs and CPA verification letters — see annual requirements. |
| Age | Applicants must be adults (18+). |
Who is effectively disqualified or poorly served
- Recent PR residents inside the lookback window.
- People who won't actually move. The 183-day and closer-connection requirements are incompatible with a mainland-centered life; this is the pattern audits target.
- Primarily salary earners.The individual decree doesn't touch wages; without meaningful investment income, the annual costs (~$15,000+/year) can exceed the benefit.
- Anyone unwilling to keep records. The program is, functionally, an evidence-maintenance obligation with a tax benefit attached.
Requirements timeline at a glance
- Pre-application: confirm lookback eligibility → assemble documents.
- Application: file via the DDEC portal (process guide) → 60–120 day review.
- Decree granted: 2-year home-purchase clock starts; Form 8898 in the year residency begins.
- Every year thereafter: 183+ days, donation by Dec 31, annual report + $5,000 fee, evidence maintained.
Frequently Asked Questions
- Do my spouse and children need to qualify separately?
- Household members appear in the application, and family location weighs heavily in the closer-connection analysis — a family living stateside undermines the residency position.
- Can I rent instead of buying?
- Renting works while the 2-year purchase clock runs; the purchase itself is mandatory under the decree.
- Is there an income minimum?
- No statutory income floor — but the fixed annual costs mean the program only makes economic sense with substantial investment income.