What Charities are Qualified to Receive Act 20/60 Donations?

Puerto Rico offers generous tax benefits to U.S. citizens and residents under Act 60 Export Services and Act 60 Individual Resident Investor, formerly known as Act 20 and Act 22, respectively. These benefits come with the requirement for decree holders to make annual donations to qualifying Puerto Rican nonprofits. Understanding which charities qualify to receive these donations is essential for compliance and maximizing the impact of these contributions.

For Act 22 Decree Holders:

• Donation Requirement: $5,000 annually.
• Qualified Charities: Nonprofits certified under Section 1101.01 (a) (2) of the Puerto Rico Internal Revenue Code.
• Documentation: Proof of donation must be included in the annual report filed each May.

For Act 60 Decree Holders:

• Donation Requirement: $10,000 annually, split into two $5,000 donations.
• Qualified Charities for the First $5,000: They must be listed by the Comisión Especial Conjunta de Fondos Legislativos para Impacto Comunitario (CECFL).
• Qualified Charities for Remaining $5,000: Any nonprofit organization operating in Puerto Rico that falls under Section 1101.01 of the Puerto Rico Internal Revenue Code, offers a broader selection than Act 22.
• Example: Fundación Futuro Brillante, which meets the criteria for the Act 60/20 donation, is one such nonprofit that can receive the $10,000 donation. They are dedicated to full transparency and efficiency, ensuring donors see how 100% of donations are spent.
• Documentation: Proof of donation must be included in the annual report filed each May.

By understanding these requirements and choosing qualified charities, decree holders can not only enjoy significant tax benefits but also contribute meaningfully to the Puerto Rican community.