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 1005 - Computation of Taxable Income (§§ 30101 — 30157) › Subchapter E - Income Source Rules (§§ 30151 — 30157) › § 30153 - Sale or exchange of personal property

(a) Except as provided in this section or §§ 30154 and 30155 of this title, any gain, profit or income derived from the sale or exchange of personal property,
(1) By a domestic corporation or by a Puerto Rico resident shall constitute income from sources within Puerto Rico; and
(2) by a foreign corporation or by an individual other than a Puerto Rico resident shall constitute income from sources outside Puerto Rico.
(3) in the case of a partnership, special partnership, corporation of individuals or limited liability company subject to the provisions of §§ 30321-30376 of this title, the source of income shall be determined at the partner, stockholder or member level, as the case may be.
(b) Exception for inventory property.— In the case of personal inventory property in the hands of the seller,
(1) this section shall not apply,
(2) the source of any gain, profit or income derived from its sale or exchange shall be determined pursuant to §§ 30154 and 30155 of this title.
(c) Exception for depreciable property.— In the case of depreciable property, any gain, profit or income derived from its sale or exchange shall be attributable to sources within and outside Puerto Rico as follows:
(1) Such part of the gain, profit or income which bears the same ratio to the aggregate of the gain, profit or income that the allowed depreciation (or allowable) against income from sources within Puerto Rico bears to the total depreciation adjustment established in § 30142(b)(1)(B) of this title, shall be treated as sources within Puerto Rico, and
(2) any portion of the gain, profit or income whose source is not determined under clause (1) of this subsection shall be determined under subsection (a).
(d) Exception for intangible property.—
(1) In the case of sale or exchange of intangible property:
(A) Subsection (a) shall only apply to the extent that payments in consideration of such sale or exchange are not contingent to productivity, use or disposition of the intangible, and
(B) to the extent that payments in consideration of such sale or exchange are contingent to the productivity, use and disposition of the intangible, the source of any gain, profit or income shall be determined in the same manner as if such payments were rentals or royalties.
(2) For purposes of clause (1), the term “intangible property” means any patent, copyright, secret process or formula, goodwill, trademark, trade brand, franchise, or other like property.
(3) For purposes of clause (1), the source of any payment in consideration of the sale of goodwill shall be determined by reference to the place in which the same was developed.
(4) Notwithstanding the provisions of clause (1), in the case of intangible property that has been subject to amortization,
(A) such part of the gain, profit or income which bears the same ratio to the aggregate of the gain, profit or income that the allowed amortization (or allowable) against income from sources within Puerto Rico bears to the total depreciation adjustment established in § 30142(b)(1)(B) of this title, shall be treated as sources within Puerto Rico, and
(B) any portion of the gain, profit or income whose source is not determined under paragraph (A) of this clause shall be determined under clause (1) of this subsection.
(e) Sale or exchange through offices or fixed places of business.— Except in the case of income whose source is determined under subsections (b), (c) or (d)(1)(B), or as provided in §§ 30154 and 30155 of this title, if a Puerto Rico resident maintains an office or other fixed place of business outside Puerto Rico, income from the sale or exchange of personal property attributable to such office or other fixed place of business outside of Puerto Rico shall be treated as income from sources outside Puerto Rico.
History —Jan. 31, 2011, No. 1, § 1035.03, retroactive to Jan. 1, 2011; Dec. 10, 2011, No. 232, § 44.