Section 936 (U.S. Tax Code)

Section 936 of the U.S. Tax Code provided tax incentives from 1976 to 2006 to encourage U.S. companies to invest and operate in Puerto Rico. It allowed qualifying companies to receive tax credits on their income earned within Puerto Rico, significantly reducing their federal and local tax bills. This aimed to promote economic development and job creation on the island. However, the provisions were phased out starting in 2006, ending the special tax benefits, and companies had to adapt to standard tax laws thereafter.