2023 Laws of Puerto Rico › TITLE THIRTEEN - Taxation and Finance (§§ 1 — 33423) › Subtitle 17 - Internal Revenue Code of 2011 (§§ 30001 — 33423) › PART II - Income Taxes (§§ 30041 — 30622) › Chapter 1007 - Credits Against Tax (§§ 30201 — 30230) › Subchapter B - Refundable Credits (§§ 30211 — 30214) › § 30211 - Earned income credit

(a) Allowance of credit.— As provided in this section, there shall be allowed as a credit against income tax to any individual resident of Puerto Rico who earns gross income, as such term is defined in subsection (b) of this section, and who are not claimed as dependents of another taxpayers for the taxable year, as such term is defined in § 30138 of this title.
(1) For taxable years beginning after December 31st, 2010, but before January 1st, 2012, the earned income credit shall be equal to three point five percent (3.5%) of such income earned up to a maximum credit of three hundred fifty dollars ($350) in a taxable year. In the case of individuals whose income earned is in excess of ten thousand dollars ($10,000), but not in excess of twenty-two thousand five hundred dollars ($22,500), the maximum credit prescribed in this clause shall be reduced by an amount equal to two percent (2%) of the income earned in excess of ten thousand dollars ($10,000).
(2) For taxable years beginning after December 31st, 2011, but before January 1st, 2013, the earned income credit shall be equal to four percent (4%) of such income earned up to a maximum credit of four hundred dollars ($400) in a taxable year. In the case of individuals whose income is in excess of ten thousand dollars ($10,000), but not in excess of twenty-five thousand dollars ($25,000), the maximum credit prescribed in this clause shall be reduced by an amount equal to two percent (2%) of the income earned in excess of ten thousand dollars ($10,000).
(3) For taxable years beginning after December 31st, 2012, but before January 1st, 2014, the earned income credit shall be equal to four point five percent (4.5%) of such income earned, up to a maximum of four hundred fifty dollars ($450) in a taxable year. In the case of individuals whose income is in excess of ten thousand dollars ($10,000), but not in excess of twenty-seven thousand five hundred dollars ($27,500), the maximum credit prescribed in this clause shall be reduced by an amount equal to two percent (2%) of the income earned in excess of ten thousand dollars ($10,000).
(4) For taxable years beginning after December 31st, 2013, but before January 1st, 2015, the earned income credit shall be equal to five percent (5%) of such income earned, up to a maximum of five hundred dollars ($500) in a taxable year. In the case of individuals whose income is in excess of ten thousand dollars ($10,000), but not in excess of thirty thousand dollars ($30,000), the maximum credit prescribed in this clause shall be reduced by an amount equal to two percent (2%) percent of the income earned in excess of ten thousand dollars ($10,000).
(5) For taxable years beginning after December 31st, 2014, but before January 1st, 2016, the earned income credit shall be equal to five point five percent (5.5%) of such income earned, up to a maximum of five hundred and fifty dollars ($550) in a taxable year. In the case of individuals whose income is in excess of ten thousand dollars ($10,000), but not in excess of thirty-two thousand five hundred dollars ($32,500), the maximum credit prescribed in this clause shall be reduced by an amount equal to two percent (2%) of the income earned in excess of ten thousand dollars ($10,000).
(6) For taxable years beginning after December 31st, 2015, the earned income credit shall be equal to six percent (6%) of such income earned up to a maximum of six hundred dollars ($600) in a taxable year. In the case of individuals whose income is in excess of ten thousand dollars ($10,000), but not in excess of thirty-five thousand dollars ($35,000), the maximum credit prescribed in this clause shall be reduced by an amount equal to two percent (2%) of the income earned in excess of ten thousand dollars ($10,000).
(b) Earned income.— The term “earned income” means wages, salaries, tips, any payment for services rendered by an employee to his/her employer, or any other employee compensation for services rendered, but only if such amounts are includible in gross income for the taxable year.
(c) Limitations.— For purposes of subsection (b) of this section, the gross income earned shall be computed without regard to any community property laws, any amount received as a pension or annuity, taxable income under § 30431 of this title (relating to income of nonresident alien individuals), no amount received for services rendered by an individual while the individual is an inmate at a penal institution.
(d) Taxable year of less than twelve (12) months.— Except in the case of a taxable year ended by reason of the taxpayer’s death, no credit shall be allowed under this section in the case of a taxable year that covers a period of less than twelve (12) months.
(e) Credit denial.— No credit whatsoever shall be allowed under subsection (a) if the taxpayer earns net income on account of interests or dividends, rentals or royalties, the sale of capital assets, child support payments in connection with divorce or separation, any other kind of income not treated as earned income, as defined under subsection (b) of this section, in excess of two thousand two hundred dollars ($2,200) for the taxable year.
(f) Credit refund.— Any individual eligible for this credit may claim it in the income tax return, such credit shall be claimed against the tax determined after all other credits provided in this part. The amount of this credit that exceeds the determined tax shall be refunded to the taxpayer or may be credited against the estimated tax for the following taxable year.
(g) Restrictions to individuals who unduly claimed the credit for the prior year.— Any taxpayer who unduly claims the earned income credit shall be responsible for the payment of an amount equal to the credit unduly claimed as income surtax, including interests, surcharges, and penalties, as provided in §§ 33001 et seq. of this title in the year in which the amount of the unduly claimed amount is determined. In case of fraud, the taxpayer, in addition to being responsible of the payment herein provided, shall be prevented from benefitting from the earned income tax for a period of ten (10) years counted as of the year in which the Secretary has determined the total of any amount unduly claimed.
History —Jan. 31, 2011, No. 1, § 1052.01, retroactive to Jan. 1, 2011; Dec. 10, 2011, No. 232, § 51.