If you are touring Dorado this fall with December 31, 2026 circled on the calendar, which document is that date actually about? Under Puerto Rico's Act 38-2026, it is the resident individual investor application. It is not the deed to the house. With about nine weeks left before the cutoff, that difference decides whether you buy on your own schedule or on a deadline the law never set.
What the December 31 Date Actually Governs
Act 38-2026 was enacted in March 2026 and amends the Act 60 Incentives Code. It keeps the resident individual investor program running through 2055 and creates a second tax regime for later applicants. Which regime applies depends on when the application was filed.
The text of Act 38 splits applicants into two groups:
- Applications filed on or before December 31, 2026: interest and dividends earned after becoming a Puerto Rico resident and before January 1, 2036 are fully exempt from Puerto Rico income tax. The same goes for gains on appreciation after residency recognized before that date.
- Applications filed on or after January 1, 2027: interest and dividends earned after becoming a resident and before January 1, 2056 are taxed at a flat 4% rate.
Every one of those provisions turns on the phrase "presentó su solicitud," meaning filed the application. None of them mentions a closing, a deed or a purchase date. A buyer who files by year-end and closes on a Dorado home months later is still in the 2026 group. A buyer who closes in December but files the application in January is not.
Existing decree rights are protected. Eligible decree holders and pending applicants can choose to move to the new regime.
The Purchase Clock Starts at the Decree
The home purchase requirement sits in a different part of the code, and it starts its own clock. The official Incentives Code compilation, revised July 16, 2026, sets out the order of events:
- The application is filed. Its date decides which tax regime applies.
- The decree is issued.
- Within two years of getting the decree, the holder must buy real property in Puerto Rico to serve as their primary residence.
- In every annual report for the rest of the decree, the holder must show they still have full ownership of that home and use it as their primary residence.
In practice, the year-end pressure falls on getting the application filed. The search for a house in Dorado can move at the pace the right property needs, within two years of the decree.
Who Can Hold the Title, and Who Can Sell It
The code is precise about how the home must be bought. The holder must acquire it by purchase, as sole owner or jointly with a spouse. The seller, whether a person or a company, must be completely unrelated to the decree holder.
That rules out some deals buyers sometimes assume will count, such as buying from a relative or from an entity connected to the buyer. The ownership options also differ by filing date.
| Requirement | Filed by Dec. 31, 2026 | Filed Jan. 1, 2027 or later |
|---|---|---|
| Purchase window | Two years after decree | Two years after decree |
| Who may hold title | Holder alone or jointly with spouse | Holder, jointly with spouse, or a trust described in Section 2022.07 |
| Proof of ownership | Evidence of the purchase | Title registered, or pending registration, in the Registro de la Propiedad |
| Tax on interest and dividends | Exempt through 2035 | 4% through 2055 |
| Prior nonresidence | Historical 2006–2012 bar applies | Six years of nonresidence before the move, plus the 2006–2012 bar |
The trust option appears only in the sentence that applies to 2027 filers. For anyone weighing an early application against the new regime, that is a planning question to take to a tax adviser before choosing a filing date.
For 2027 Filers, the Proof Is Recorded in Bayamón IV
For applications filed from January 1, 2027, the home's title must be recorded, or pending recording, in Puerto Rico's Property Registry. That makes the Registry part of the incentive file.
Dorado properties are recorded at the Registry section Bayamón IV, which also covers Vega Baja and Cataño. It is located on Carretera 167, next to the Bayamón municipal library.
Under Puerto Rico's Registry law, a home purchase is recorded in two steps:
- Presentación: the deed is delivered to the Registry, on paper or as a digital image, with the required fees. This step is complete once the electronic receipt is issued.
- Inscripción: the deed is actually entered in the Registry, after the Registry reviews its form, the parties' capacity and the legality of the transaction.
When a deed is presented, the Registry makes an entry called the asiento de presentación. Under the Registry law, that entry records the exact date and time of filing, an entry number, the parties, the fees paid and the property identifiers, and the Registry issues a separate receipt for the filing. The receipt and entry number are how a filed deed is tracked while it waits to be recorded. Deeds can be filed online through the KARIBE system, but according to the Registry's FAQ, only a notary or authorized official can submit a document electronically. For a Dorado buyer, that makes the closing notary the person who produces the document the incentive file will rely on.
Recording also takes time. The statute gives the Registry 90 working days after presentation to review a deed and report any defects. If it finds defects, the period to correct them is 60 days. In October 2025, Puerto Rico Posts reported Registry officials' announcement that the backlog of documents awaiting review had fallen 96% from a historical peak of more than 600,000. As of October 24, 2025, 25,747 documents were still pending.
The code's wording, "inscrita, o pendiente de inscripción," puts a deed that is pending recording alongside one that is already recorded. With a two-year window, that makes the timing and accuracy of the notary's presentation something a buyer will want to discuss with the notary and their tax adviser well before closing.
How Dorado's Housing Supply Affects the Window
The two-year window is plenty for a buyer who wants a finished home that is ready to close. It gets tighter when the home a buyer wants does not exist yet.
Dorado Beach includes residential areas such as La Cala, Livingston Estates, West Point, The Isles, West Beach, East Beach and Dorado Beach East. Livingston Lakefront Estates, a private-dock community on the Mata Redonda Lagoon, is listed by the resort as under construction. Farther out, El Nuevo Día reported in April 2026 on Dorado Waterfalls, a proposed luxury enclave on 233.7 cuerdas near the Río La Plata. At the time, its developer was still seeking permits and endorsements.
The code asks for evidence that ownership was acquired by purchase within two years. A purchase contract on a home still being built is a different document from a deed, and a deed under Registry review is a third thing. Buyers looking at new construction should ask their notary and tax adviser how the expected delivery date lines up with their decree date before signing.
The Home Keeps Counting After the Closing
The annual report must show that the holder keeps full ownership of the primary residence for as long as the decree lasts. Each annual report carries a $5,000 filing charge under the statute. Decree holders must also document at least $10,000 a year in contributions to eligible Puerto Rico nonprofits, starting in the second tax year after receiving the decree.
The U.S. Government Accountability Office's December 2025 report on the program explains who enforces these terms. Puerto Rico's Department of Economic Development and Commerce, known as DDEC, administers the decrees and their local requirements. The IRS has no authority to decide whether a taxpayer meets them. GAO also reported that DDEC can terminate a decree when requirements are not met. A late annual report can sometimes be cured, but a failure to meet the residency requirement cannot be fixed after the fact. The same report counted 5,852 resident investor decrees granted from 2012 through 2024, with the most granted in 2021.
This post is general information, not legal, tax or financial advice. Confirm the details of your own application and purchase with a qualified tax adviser and your closing notary.
Frequently Asked Questions
Do I need to close on a Dorado home by December 31, 2026 to get the old regime? The Act 38 text ties the regime to the date the application is filed. The purchase requirement runs for two years from when the decree is issued.
Does the code set a minimum price or require a particular town? The residence provision states no minimum purchase price and names no municipality or community.
Where is my Dorado deed recorded? At the Property Registry section Bayamón IV. Your notary can file it electronically through KARIBE.
If your Act 60 timeline and a Dorado purchase need to fit together, HECO PROPERTIES can line up your search, contract terms and closing with the dates on your decree file, working alongside your adviser and notary. Request a Private Consultation.
