Treasury Dept. announces ‘pro-taxpayer’ changes in 2020 tax cycle
By Pedro Correa Henry
Special to The Star
Puerto Rico Treasury Secretary Francisco Parés Alicea urged islanders on Wednesday to pay their taxes as the incoming cycle will include discounts and benefits that could reward any eligible citizen who files them on or before April 15.
Parés Alicea pointed out that amid the coronavirus pandemic, the 2020 tax cycle has brought out “pro-taxpayer” changes that could buoy citizens economically.
As for particular benefits, the Treasury secretary said individuals will benefit from a total 8 percent discount on the tax rate by combining the five percent reduction for 2019 with the three percent reduction for 2020.
Another benefit for islanders will be the American Opportunity Tax Credit, from which Parés Alicea said local taxpayers benefited in 2017 “retroactively due to [work] done by the Internal Revenue and Tax Policy division.”
“Undergraduate students who are still in their first four academic years, whether their tutor or legal guardian claims them as a dependent or the student works and pays taxes, will have the chance to request a credit of up to $1,000,” the Treasury secretary said. “There are taxpayers who could be receiving up to $3,000 in refundable credit.”
As for refundable credit, Parés Alicea said that if the citizen does not hold any contributory liability with the Treasury Department, the agency “is required to provide a check or direct deposit in favor of the taxpayer.”
Meanwhile, the Treasury secretary announced that citizens who did not receive the earlier Economic Impact Payments in full can request the disbursement again through this tax cycle.
“There were taxpayers who, for different reasons, did not receive either the $1,200 or the $600 checks, or did not receive compensation for their dependents, or had demographic changes as the family might have received a new dependent during the running tax year,” the secretary said. “The taxpayer can request the $600 per dependent from the first Economic Impact Payment or the $500 per dependent from the second one retroactively.”
“In the case of their not having received the Economic Impact payments claim, the Department is sending a notification to the taxpayers at the e-mail address they have provided us [via SURI], called Model SC 6174 -- Federal Additional Economic Impact Notification,” Parés Alicea added. “This communication certifies the payments that each citizen has received, as recorded in our records, and will be needed by eligible citizens to complete the claim through Schedule B3, Economic Impact Payment, which must accompany the [tax] return.”
Parés Alicea said meanwhile that taxpayers can also benefit from the Working Tax Credit, as workers whose income does not exceed $42,000 could generate from $300 to $2,000 in tax credits.
However, he added that it will all depend “on the number of incomes and the number of dependents the taxpayer claims.”
As for individual income tax returns that have been filed, Parés Alicea said that with one week before the electronic filing process is to begin, 117,081 returns have already been received by the Treasury and around $22.8 million in refunds have been paid.
“We are satisfied with the taxpayers’ response to this process, which is just beginning,” the agency chief said.