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 1003 - Definitions and General Provisions (§§ 30041 — 30045) › § 30041 - Definitions

(a) As used in this part, insofar as they are not incompatible with the purposes thereof:
(1) Person.— Shall be construed to mean and include an individual, trust or estate, partnership or corporation.
(2) Corporation.— Includes limited companies, joint-stock companies, private corporations, insurance companies, limited companies, and any other corporations organized under §§ 3501 et seq. of Title 14, known as the “General Corporations Act”, or any other association receiving income or earning profits taxable under this part. The terms “association” or “partnership” also include other analogue entities, any organization other than a partnership created for purposes of carrying out transactions or achieving certain purposes, which in like manner as corporations, may continue to exist regardless of the changes in the membership or stockholders, and whose business is directed by one person, committee, board or any other body acting in a representative capacity. The terms “association” and “corporation” also include voluntary associations, business trusts, Massachusetts trusts, and common law trusts, and except as otherwise provided in this Code, limited liability companies. The term “corporation” also includes those entities not otherwise incompatible with the provisions of Subchapter M of Chapter 3 of this Subtitle A to Special Employee-owned Corporations.
(3) Limited liability company.— Means those entities organized under §§ 3951—4006 of Title 14, known as the “General Corporations Act”, or under similar laws of any state of the United States of America or foreign country. For purposes of this chapter, limited liability companies shall be subject to taxation in the same manner and form as corporations; Provided, however, That they may elect to be treated as partnerships for tax purposes under the rules applicable to partnerships and partners contained in §§ 30321 et seq. of this title, even when the company has only one single member. The Secretary shall establish through regulations, the form and manner of making such election, as well as the deadline for the filing thereof.
(A) Exception.— Any limited liability company that, for reasons of an election or provision of law or regulation under the Federal Internal Revenue Code of 1986, Title 26 of the United States Code, as amended, or similar provision of a foreign country, is treated as a partnership or whose revenues and expenses are attributable to its members for federal or foreign country income tax purposes, shall be treated as a partnership for purposes of this part, subject to the provisions of §§ 30321 et seq. of this title, and shall not be eligible to pay taxes as a corporation.
(B) The exception provided in paragraph (A) of this clause shall not apply to a limited liability company that, as of the effective date of this Code, is covered under an exemption decree issued under §§ 10641 et seq. of this title, known as the “Economic Incentives Act for the Development of Puerto Rico”, or any other analogous law, or under §§ 6001 et seq. of Title 23, known as the “Puerto Rico Tourist Development Act”, as amended and any other preceding or subsequent analogous law.
(4) Partnership.— Includes general or limited, civil societies, business, industrial, agricultural, professional partnerships or of any other kind, whether or not its organization is set forth by public instrument or private document; and it shall include, further, two or more persons, whether under a common name or not, engaged in a joint venture for profit except as provided with regard to special partnerships. The term “partnership” includes any other unincorporated organization through which any trade or business is carried on.
(A) Exception for partnerships existing on the effective date of this Code.— In the case of partnerships existing on the effective date of this Code, may elect to be treated as corporations for purposes of the tax imposed under this part, in accordance with the provisions of § 30243(e) of this title.
(5) Special partnership.— Includes a partnership or corporation engaged in any of the activities listed in § 30551 of this title that has elected to avail itself of the provisions of §§ 30551—30578 of this title. A partnership whose only partners are persons married to each other shall not be recognized as a special partnership.
(6) Domestic.— When applied to a corporation or partnership means created or organized in Puerto Rico or under the laws of Puerto Rico.
(7) Foreign.— When applied to a corporation or partnership means a corporation or partnership which is not domestic.
(8) Fiduciary.— Means a guardian, trustee, executor, administrator, receiver, conservator, or any person acting in any fiduciary capacity for any person.
(9) Stock.— Includes shares in an association, limited company, joint-stock company, private corporation or insurance company.
(10) Shareholder.— Includes a member of a limited company, joint-stock company, private corporation or insurance company.
(11) Partner.— Includes a member of a partnership, special partnership or participant therein.
(12) Secretary.— Means the Secretary of the Treasury of Puerto Rico.
(13) Collector.— Means an internal revenue collector.
(14) Taxpayer.— Means any person subject to any tax imposed under this part.
(15) Withholding agent.— Means any person required to deduct and withhold any tax under the provisions of §§ 30086, 30087, 30084, 30085, 30272, 30273, 30274, 30275, 30278, 30279, 30280 and 30281, all of this title.
(16) Spouse.— As used in §§ 30112 and 30419 of this title, means, wherever appropriate, husband or wife. If the spouses therein referred to were divorced, such term shall mean “former spouse”.
(17) Taxable year.— Means:
(A) The taxpayer’s annual accounting period, whether a calendar or fiscal year;
(B) the calendar year, if subsection (g) of § 30171 of this title is applicable, or
(C) the period for which the tax return is filed, if the return covers a period of less than twelve (12) years.
(18) Economic year.— Means an accounting period of 12 months ending on the last day of any month other than December. In the case of any taxpayer who has chosen the option provided in § 30171(f)(1) of this title, such term means the annual period thus chosen (that fluctuates between 52 and 53 weeks).
(19) Paid or incurred, paid or accrued.— Shall be construed according to the method of accounting upon the basis of which the taxable income is computed under this part.
(20) Trade or business.— Includes the performance of the functions of a public office.
(21) Nonresident alien.— Means an individual who is not a United States citizen and is not a resident of Puerto Rico.
(22) Court of First Instance, Court of Appeals and Supreme Court.— Means the Court of First Instance of Puerto Rico, the Court of Appeals of Puerto Rico, and the Supreme Court of Puerto Rico.
(23) International organization.— Means a public international organization entitled to enjoy privileges, exemptions, and immunities as an international organization under the International Organizations Immunities Act, approved on December 29, 1945.
(24) Hotel.— A building or group of buildings mainly and bona fide devoted to the furnishing of accommodation for pay, primarily to transient guests, in which no less than fifteen (15) rooms are furnished for accommodation of such guests, and having one or more dining rooms where meals are served to the general public; provided, that such facilities are operated in Puerto Rico under conditions and standards of sanitation and efficiency that meet the requirements of the applicable laws of the Government of Puerto Rico.
(25) Shipping business.— Means:
(A) A business engaged in the transportation of freight between ports in Puerto Rico and ports in foreign countries.
(B) A business leasing ships which are used in said transportation, or personal and real property utilized in relation with the operation of said ships when the transportation meets the above requirements.
(26) Gross income.— Shall have the meaning provided in § 30101 of this title.
(27) Adjusted gross income.— Shall have the meaning provided in § 30103 of this title.
(28) Net income.— Shall have the meaning provided in § 30105 of this title.
(29) Industrial development income.— Shall have the same meaning as in §§ 10641 et seq. of this title, known as in the term “industrial development income” under the various Puerto Rico Industrial Incentives Acts or analogous laws.
(30) Resident individual.— Means an individual who is domiciled in Puerto Rico. It shall be presumed that an individual is a resident of Puerto Rico, if he/she has been present in Puerto Rico for a period of one hundred eighty-three (183) days during the calendar year.
The Secretary shall establish by regulations to that effect the factors to be considered in determining domicile for purposes of this subsection.
(31) Account or social security number.— Shall mean the number assigned by the Secretary to a person under §§ 171 et seq. of this title, or the social security number assigned to a person under the U.S. Social Security Act.
(32) Fiscal year.— Means an accounting year of the Government of Puerto Rico that comprises a period of twelve (12) months beginning on July 1 and ending on June 30 of the following year.
(33) Investment company or Registered investment company.— The terms “investment company”, or “registered investment company”, or “investment company registered” shall only include investment companies registered under §§ 661 et seq. of Title 10, known as the “Puerto Rico Investment Companies Act”, and under the Puerto Rico Investment Companies Act of 2013, §§ 691 et seq. of Title 10. For purposes of this part, investment companies shall be subject to taxation under the provisions of § 30521 of this title. The terms “investment company”, or “registered investment company”, or “investment company registered” exclude exempt investment trusts, as defined in clause (34) of this subsection.
(34) Exempt investment trust.— The term “exempt investment trust” shall only include investment companies classified as exempt investment trusts, as defined in the Puerto Rico Investment Companies Act of 2013. Provided, That exempt investment trusts may elect to be treated as partnerships for tax purposes, under the rules applicable to partnerships and partners contained in §§ 30321 et seq. of this title, in which case any reference to partnerships subject to taxation under §§ 30321 et seq. of this title shall be understood to include exempt investment trusts that have filed an election to be treated as such. The Secretary shall prescribe the form and manner to make such an election, as well as the deadline for the filing thereof.
(b) Includes.— When used in a definition contained in this part shall not be deemed to exclude other things otherwise within the meaning of the term defined.
History —Jan. 31, 2011, No. 1, § 1010.01, retroactive to Jan. 1, 2011; Dec. 10, 2011, No. 232, § 3; July 30, 2013, No. 93, § 2; Nov. 27, 2013, No. 137, § 19.