By Zain Deane
Puerto Rico Travel Expert, about.com
For more than 60 years, Puerto Rico has been an alluring destination for American travelers; in fact, in its golden age of tourism, the island was a haven for A-list movie stars, billionaire tycoons with names like Rockefeller, and a wealthy elite.
[post_ads_2]
In the last few years, there's been a strong push to return to that model. With top-class hotels like the St. Regis BahÃa Beach, the Ritz-Carlton Reserve, and the rebirth of the legendary Condado Vanderbilt Hotel
to complement properties like the W Retreat in Vieques and the Horned
Dorset Primavera in Rincón, the island is making a strong push to become
a destination for the wealthy.
And it's not just targeting wealthy tourists. A recent NPR report
explains that laws enacted in 2012 are making it more than enticing
than ever for U.S. millionaires to pick up and move to the island. Why?
Here are three simple reasons:
- When you move to the island, all of your investment income, (capital gains, dividends, etc.) are completely tax-free.
- Your service income (a hedge fund's management fees, for example) is taxed at only 4 percent.
- There is no federal income tax for Puerto Rican residents.
Of
course, merely having a mailing address in Puerto Rico isn't going to
get you all these breaks. You have to live here at least 183 days a year
with your family (your kids need to be enrolled at local schools, if
applicable.
[post_ads]The idea is to bring some needed capital to the
island; after all, Puerto Rico has offered similar tax breaks to U.S.
corporations; why not try it at the individual level? An influx of
high-income residents who live and spend money on the island should be a
good thing for the economy.
But beyond the math, does it make
sense for a millionaire in the U.S. to move to Puerto Rico? I'd argue
that those who have never visited the island aren't fully aware of all
it can offer them. Puerto Rico can provide a terrific lifestyle. The
Caribbean and Atlantic are never more than a short drive (or walk) away.
And then there's San Juan, a bustling capital city with high-end condos
and lovely homes available. Many Americans also relocate to Vieques
Island and Culebra Island; I've had a chance to tour some of the spectacular mansions in Culebra, and I wouldn't mind calling one of them home!
You'll also enjoy world-class dining, with internationally renowned celebrity chefs like José Andrés and Jean-Georges Vongerichten opening branches on the island to complement outstanding local talent
like Chefs Wilo Benet and Roberto Treviño. As for leisure and
entertainment, the casinos, clubs, lounges and bars stay busy and stay
open late in San Juan. When it comes to performing arts, the calendar is
filled with the world's biggest celebrities, acts and performers, from
classical music and ballet to rock and pop, to Broadway productions.
And finally, there is accessibility. Puerto Rico's unique relationship with the U.S.
means, among other things, that you don't need a passport to get here.
Add the fact that the island is a mere 2.5-hour flight from mainland
U.S., and a large community of Americans already call Puerto Rico home,
and you can see how a move here may be just what the financial advisor
ordered.
Puerto Rico's ability to offer incentives has helped
boost its economy in the past. If these news laws are any indication, it
may do so again. And if you're looking for a place where your dollar
goes a longer way, you might want to take an exploratory trip to the
island. You might be surprised at what it offers you beyond the tax
breaks.
