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 1012 - Nonprofit Organizations (§§ 30471 — 30487) › Subchapter B - Taxation Of Business Income Of Certain Exempt Organizations And Denial Of Exemption For Certain Prohibited Transactions And Improperly Accumulating Surplus (§§ 30481 — 30487) › § 30482 - Unrelated business net income

(a) Definition.— The term “unrelated business net income” means the gross income derived by any organization from any unrelated trade or business (as defined in § 30483 of this title) regularly carried on by it, less the deductions allowed by §§ 30121—30140 of this title that are directly connected with the carrying on of such trade or business, both computed with the exceptions, additions and limitations provided in subsection (b). In the case of an organization described in § 30481 of this title which is a foreign organization, the unrelated business net income will be the gross income derived from sources within Puerto Rico, and the gross income which is effectively connected with the operation of a trade or business in Puerto Rico, determined under §§ 30151 and 30154 of this title, and §§ 30432, 30433(a), 30441(c) and 30443(a) of this title.
(b) Exceptions, additions, and limitations.— The exceptions, additions, and limitations applicable to the determination of the unrelated business net income are the following:
(1) There shall be excluded all dividends, partnership profits, interest, and annuities, and all deductions directly connected with such income.
(2) There shall be excluded all royalties, including overriding royalties, whether measured by production or by gross or net income from the property, and all deductions directly connected with such income.
(3) There shall be excluded all rents from real property (including personal property leased with the real property), and all deductions directly connected with such rents.
(4) Notwithstanding the provisions of clause (3), in the case of a business lease (as defined in § 30484 of this title) there shall be included, as an item of gross income derived from an unrelated trade or business, the amount determined under § 30484(a)(1) of this title, and there shall be allowed, as a deduction, the amount determined under § 30484 (a)(2) of this title.
(5) There shall be excluded all gains or losses from the sale, exchange, or other disposition of property other than:
(A) Stock in trade or other property of such kind which would properly be includible in inventory if on hand at the close of the taxable year, or
(B) property held primarily for sale to customers in the ordinary course of trade or business.
(6) The net operating loss deduction provided in § 30134 of this title shall be allowed, except that:
(A) The net operating loss for any taxable year, the amount of the net operating loss carryover to any taxable year, and the net operating loss deduction for any taxable year shall be determined under § 30134 of this title without taking into account any amount of income or deduction which is excluded under this subchapter in computing the unrelated business net income, and
(B) the term “preceding taxable year”, as used in § 30134 of this title shall not include any taxable year for which the organization was not subject to the provisions of this subchapter.
(7) There shall be excluded all income derived from research for:
(A) The United States, or any of its agencies or instrumentalities, or any state or political subdivision thereof, and
(B) the Government of Puerto Rico, or any agency, instrumentality or political subdivision thereof, and there shall be excluded all deductions directly connected with said income.
(8) In the case of a college, university, or hospital, there shall be excluded all income derived from research performed for any person, and all deductions directly connected with such income.
(9) In the case of an organization operated primarily for purposes of carrying on fundamental research, the results of which are freely available to the general public, there shall be excluded all income derived from research performed for any person, and all deductions directly connected with such income.
(10) In the case of any organization described in § 30481(a) of this title, the deduction allowed by § 30130 of this title (related to charitable and other gifts and contributions), shall be allowed (whether or not directly connected with the conduct of the trade or business), but shall not exceed ten percent (10%) of the unrelated business net income computed without the benefit of this clause.
(11) In the case of any trust described in § 30481(b) of this title, the deduction allowed by § 30135(a)(3) of this title (related to charitable and other gifts and contributions), shall be allowed (whether or not directly connected with the conduct of the trade or business), and for that purpose a distribution made by the trust to a beneficiary described in § 30135(a)(3) of this title shall be considered as a gift or contribution. The deduction allowed by this clause shall not exceed fifty percent (50%) of the unrelated business net income computed without the benefit of this clause.
(12) A specific deduction of one thousand dollars ($1,000) shall be allowed.
History —Jan. 31, 2011, No. 1, § 1102.02, retroactive to Jan. 1, 2011; Dec. 10, 2011, No. 232, § 113.