In a May 2024 post from Business Insider, Filip De Mott summarizes how the IRS has made little progress “in the abuse of a Puerto Rican tax benefit,” according to a whistleblower.
The article highlights the slowness of the IRS’s movement to audit the tax break beneficiaries residing in Puerto Rico. For example, De Mott demonstrates that “if a business was started in the mainland US and sold after its owners settled on the island, the tax benefit should only apply for the years lived in Puerto Rico.” However, investors ignore what is mentioned above and are “exempting the entirety of their profits.”
While this raises concern over the IRS’ lack of involvement in the matter, IRS Commissioner Danny Werfel asserts that the IRS is “coming out of” a “period of underinvestment” and is still building its strengths. While the movement might be slow, Werfel argues that there are beneficiaries of the tax break being audited and will continue to do so.
All quotations were taken directly from the article. You can read the same link here.
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