Opportunity Zone Magazine Volume 1, Issue 3 | Page 72

72 OPPORTUNITY ZONE MAGAZINE | VOLUME 1 • ISSUE 3 PUERTO RICO’S RARE POSITION IN THE OZ SPACE By María de los Angeles Rivera After decades of decreasing economic activity, Puerto Rico is an attractive jurisdiction for OZ investment today, offering special incentives and favorable tax rates for investors in its 800 designated OZs. Puerto Rico is a United States possession in the Caribbean Sea. Its political situation was unfamiliar for many U.S. citizens on the mainland until September 2017 when hurricanes Maria and Irma lashed the small island. The natural disaster and related aftermath caused by the storms emphasized the need of investment in the infrastructure and affordable and secure housing that the several years’ long economic crisis had left unattended. While those born on the Island are U.S. citizens, for several provisions of United States law the Island is treated as a foreign country. For example, entities organized under the laws of Puerto Rico are considered foreign entities for United States federal income taxes, while Puerto Rico born U.S. citizens are considered nonresident aliens for U.S. estate and gift tax purposes. These complicated circumstances support the matchless position Puerto Rico has when investors are looking for alternatives for their next investment. OPPORTUNITYZONE.COM