Q&A: Disregarded Entities for Puerto Rico Income Tax Purposes

The concept of a disregarded entity was unknown for Puerto Rico income tax purposes until last year when it was introduced to the Puerto Rico Internal Revenue Code of 2011, as amended (the “PR Code”) by Act No. 52 of June 30, 2022.  By contrast, for United States income tax purposes, the disregarded entity tax treatment has been available since the late 1990s.  The questions and answers in this article discuss the main topics related to disregarded entities for Puerto Rico income tax purposes.