Question

Capital gains for Puerto Rico bona-fide residents

Forum|Forum|2 years ago
January 1, 2024
1 reply
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I'm a bona-fide resident of Puerto Rico and I want to use TurboTax to file my federal returns. Does TurboTax handle capital gains automatically or do I have to make manual adjustments to get it to work correctly?

The correct treatment for capital gains on stocks/bonds is that they are taxable based on residency. So I need to pay the Hacienda of Puerto Rico and NOT the IRS.

A

Anonymous_

Employee

I'll page Champ @pk12_2

Α

ΑΩ79_2Author

Thanks for your response.

I just tried this:

I input a $10,000,000 capital gain on a cryptocurrency. The federal tax liability should be $0 for a bona fide Puerto Rico resident, but the software is showing a $4mm+ federal tax liability. This is categorically WRONG. (The capital gains liability is due to the Hacienda of Puerto Rico, not the IRS.)

What should I do? Should I report it as a software error? Or should I input the information in a way that computes the correct tax liability?

B

BillM223

Please see this answer from Ernie on Puerto Rican taxation.

As for your second question, you are responsible for the final return, not your input, so if necessary (I am not sure that it is in this case - see's Ernie's answer above), adjust the input to make the numbers come out the way you want (and which are legal).

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