Puerto Rico Tax Calculator (2026)
Income tax rates and take-home pay for Puerto Rico
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Puerto Rico Income Tax Brackets (2025)
| Bracket | Income Range | Rate |
|---|---|---|
| No tax bracket | $0 - $9,000 | 0.0% |
| 7% bracket | $9,000 - $25,000 | 7.0% |
| 14% bracket | $25,000 - $41,500 | 14.0% |
| 25% bracket | $41,500 - $61,500 | 25.0% |
| 33% bracket | $61,500+ | 33.0% |
Personal allowance: $3,500
Social Security (OASDI)
| Bracket | Income Range | Rate |
|---|---|---|
| Social Security employee rate | $0 - $168,600 | 6.2% |
Capped at $10,449 per year
Medicare (HI)
| Bracket | Income Range | Rate |
|---|---|---|
| Medicare base rate | $0 - $200,000 | 1.5% |
| Medicare additional rate | $200,000+ | 2.4% |
Puerto Rico Disability Benefits Tax
| Bracket | Income Range | Rate |
|---|---|---|
| Disability benefits tax | $0+ | 0.6% |
Puerto Rico Employment Security Tax
| Bracket | Income Range | Rate |
|---|---|---|
| Employment security tax | $0+ | 0.8% |
Alternate Basic Tax (ABT)
| Bracket | Income Range | Rate |
|---|---|---|
| ABT 1% bracket | $25,000 - $50,000 | 1.0% |
| ABT 3% bracket | $50,000 - $75,000 | 3.0% |
| ABT 5% bracket | $75,000 - $150,000 | 5.0% |
| ABT 10% bracket | $150,000 - $250,000 | 10.0% |
| ABT 24% bracket | $250,000+ | 24.0% |
Applies when income exceeds $25,000
Gradual Adjustment Tax (GAT)
| Bracket | Income Range | Rate |
|---|---|---|
| GAT 5% on excess over USD 500,000 | $500,000+ | 5.0% |
Applies when income exceeds $500,000
Tax Rate Reduction (Act 60)
| Bracket | Income Range | Rate |
|---|---|---|
| Reduction to 92% for gross income ≤ USD 100,000 | $0 - $100,000 | 0.0% |
| Reduction to 95% for gross income > USD 100,000 | $100,000+ | 0.0% |
Key Facts
Tax Year
2025
Currency
USD
Top Rate
33.0%
Brackets
5 brackets
Allowance
$3,500
Social Contributions
4 items
Assumptions
- · Model assumes a Puerto Rico resident individual employee with employment income only.
- · Personal exemption of USD 3,500 applied as a deduction from gross income.
- · ABT (Alternate Basic Tax) modeled as a surcharge on regular income tax; computed on ABT taxable income which approximates gross income for employees without significant exempt income add-backs.
- · Gradual adjustment tax (GAT) applies when net taxable income exceeds USD 500,000; modeled as a surcharge with a cap of 33% of exemption plus USD 8,895.
- · Tax Rate Reduction: For taxable years after 31 December 2019, total tax is reduced to 92% of computed tax if gross income ≤ USD 100,000, or 95% if gross income > USD 100,000. This reduction is modeled as a surcharge with negative rate.
- · Self-employed optional tax, Act 132 rental exemptions, Act 22 investor exemptions, and Act 257 Earned Income Credit excluded as model is for standard W-2 employee.
- · US Social Security and Medicare withholding (employee portion) included as separate social contributions.
- · Puerto Rico disability benefits tax and employment security tax included as employee contributions.
- · Itemized deductions (charitable, medical, mortgage interest, education, casualty losses) excluded; model assumes standard employee with no major deductible expenses beyond the personal exemption.
- · No standard deduction exists in Puerto Rico; personal exemption is the primary relief mechanism.
- · Act 60 Act 22 provisions for resident investor exemptions and Act 257 EIC excluded as outside scope of standard resident employee model.
Frequently asked questions
What is the Puerto Rico income tax rate for someone earning $50,000 per year?
Puerto Rico uses a progressive tax system with brackets ranging from 0% to 33%. For $50,000 in gross income, after applying the $3,500 personal exemption, you would fall into multiple brackets with rates of 7%, 14%, and 25%, resulting in an effective tax rate significantly lower than the top rate. Additionally, Act 60 provides a tax rate reduction that brings your total tax down to 92% of the computed amount since your income is under $100,000.
Do I have to pay US Social Security and Medicare taxes if I work in Puerto Rico?
Yes, as an employee in Puerto Rico, you must contribute to both US Social Security (OASDI) at 6.2% and Medicare (HI) at 1.45% on your gross income, up to the annual wage base limits. These are separate from Puerto Rico income tax and are withheld from your paycheck just as they would be on the US mainland.
What additional Puerto Rico-specific employment taxes should I expect?
Beyond federal Social Security and Medicare, Puerto Rico employees pay two additional taxes: the Puerto Rico Disability Benefits Tax at 0.6% and the Puerto Rico Employment Security Tax at 0.75%, both calculated on your gross income. These contributions fund local social insurance programs and are mandatory for all employees.
Is there a standard deduction in Puerto Rico, or how does tax relief work?
Puerto Rico does not have a standard deduction; instead, it offers a personal exemption of $3,500 that is deducted from your gross income before calculating tax. This exemption is the primary tax relief mechanism for standard employees and is significantly lower than the US federal standard deduction.
What happens if I earn more than $500,000 in Puerto Rico?
If your net taxable income exceeds $500,000, you become subject to the Gradual Adjustment Tax (GAT), which applies a 5% surcharge on income above that threshold. This surcharge is in addition to regular income tax and the Alternate Basic Tax (ABT), creating additional tax liability for high earners.
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