http://dealbook.nytimes.com/2013/03/25/puerto-ric…
This isn't exactly new news but I'm curious to know if anyone thinks this will take off in the coming years/decades. 183 days per year in Puerto Rico earns you an effective tax rate of ~0%. You can still live in NYC half the year and if there's a need to be in the NYC office, you're only a ~4 hr flight away. I'm surprised more Wall Street types aren't jumping all over this (although Paulson was rumored to be contemplating the jump). That being said, we are only 3 years into this program. What are the odds of Puerto Rico becoming the next Switzerland or Singapore in the decades to come?
I certainly know I wouldn't mind getting away from New York winters and outrageous taxes.
I'm contemplating relocating my business there, and once it's sold my thoughts were to try and start a PE firm that acquired other small internet businesses that could benefit from being located there but lacking the relevant Banking/PE experience.
Bumping this in light of Glen Scheinberg being there
9 year bump wow nice
Haha well I wanted to see what was up. Honestly assumed there would be more on the topic in the forum.
...you thought that moving to Puerto Rico would be more popular on a forum of 20-25 year olds who specifically work on or want to work on Wall Street?
Since we already have a 9 year bump… I’ll answer my own question. Rich dudes spending 6 months out of the year in Puerto Rico has taken off. Especially post-Covid where WFH flexibility is an option at a lot of places. I see this more at the partner level than the analyst/associate level, though.
No not that demographic, though I understand that demographic is common on here, but referring to the type Pokemon Master referred to below
When I went to HBS in our case studies we talked about this once
Counter point - you have to live in Puerto Rico and be verifiably physically present there for half of the year.
That’s a steep price because PR is more third world than people realize. NYT did a piece a while back on citizens who lived in PR for 183 days. They’re required to keep careful records of where they were and when. They’re glorified tax cheats and no one really likes them.
I seriously considered moving for residency with my current role. Spent a week there to test the waters. Fun to visit, not to live by any stretch of the imagination unless you're already disgustingly rich. If you don't like taxes you're 1000% better off just going to TX/FL if you want warmth or NH if you prefer the Northeast.
Knew it was worse than Florida in terms of infrastructure, but I didn't know it was that bad. Yikes.
This is true of lots of places. Many of us are New Yorkers, and NYC is incredibly strict about this sort of thing. I have and had colleagues who would drive out of the city to buy half a gallon of gas by the most circuitous route possible (to avoid paying tolls), just for the receipt, to "prove" they weren't in the city that day.
It’s more than just physical presence too. IRC 937 requires 1) Presence Test, 2) Tax Home Test, and 3) Closer Connection Test. #3 is most difficult to comply with. They look at family location, where your kids go to school, driver’s license, primary residence, where belongings are kept, club memberships, social/community ties, and more. The Closer Connection Test is much more open ended and ambiguous than just spending 183 days per year there so it’s a good idea to have a tax attorney on standby in these situations.
Puertorrican here. Born and raised on this island pretty much all my life. Love this island with all my heart. Went to Boston for four years of undergrad and did my MBA in the South. Came back to work in finance.
The explosion of wealthy people (and tourists in general) has been insane. This goes all the way back to the pandemic when people realized buying a house here was the jackpot due to citizenship and tropical climate. Tax incentives only poured gasoline on that fire.
I'd say the majority of the wealth is concentrated in three different areas of the island (besides Condado) where there are private resorts and clubs with a ton of amenities and constantly growing. Insane houses are springing up and private schools are filled more and more with kids of these wealthy families. Also, interesting to know it's common for international parents to send their kids to go to school here. Gives them an edge in college apps but that loophole is quickly disappearing.
I will say, the response from the locals to this influx of wealthy is not too good. People realize they're only here for tax reasons and they couldn't give two shits about the island itself. The wealthy people don't care. They land at the airport and drive straight to their houses in the gated resorts and naturally avoid locals. I see both sides of the coin since I work for people described in that article and in some ways, these wealthy people coming over are jackasses. They come and talk like they own the place with no sense of humility. Some advice to those who are thinking of coming over here: don't be a jackass. And try to learn spanish for fucks sake. I know English is pretty commonly known here but how hard is it to just learn a new language and get along better with the local population.
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