[Title 26 CFR 1.933-1]
[Code of Federal Regulations (annual edition) - April 1, 2002 Edition]
[Title 26 - INTERNAL REVENUE]
[Chapter I - INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY]
[Subchapter A - INCOME TAX (CONTINUED)]
[Part 1 - INCOME TAXES]
[Sec. 1.933-1 - Exclusion of certain income from sources within Puerto Rico.]
[From the U.S. Government Printing Office]


26INTERNAL REVENUE102002-04-012002-04-01false1.933-1Sec. 1.933-1INTERNAL REVENUEINTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURYINCOME TAX (CONTINUED)INCOME TAXES
Sec. 1.933-1  Exclusion of certain income from sources within Puerto Rico.

    (a) General rule. An individual (whether a United States citizen or 
an alien), who is a bona fide resident of Puerto Rico during the entire 
taxable year, shall exclude from his gross income the income derived 
from sources within Puerto Rico, except amounts received for services 
performed as an employee of the United States or any agency thereof. 
Whether the individual is a bona fide resident of Puerto Rico shall be 
determined in general by applying to the facts and circumstances in each 
case the principles of Secs. 1.871-2, 1.871-3, 1.871-4, and 1.871-5, 
relating to what constitutes residence or nonresidence, as the case may 
be in the United States in the case of an alien individual. Once bona 
fide residence in Puerto Rico has been established, temporary absence 
therefrom in the United States or elsewhere on vacation or business 
trips will not necessarily deprive an individual of his status as a bona 
fide resident of Puerto Rico. An individual taking up residence in 
Puerto Rico during the course of the taxable year is not entitled for 
such year to the exclusion provided in section 933.
    (b) Taxable year of change of residence from Puerto Rico. A citizen 
of the United States who changes his residence from Puerto Rico after 
having been a bona fide resident thereof for a period of at least two 
years immediately preceding the date of such change in residence shall 
exclude from his gross income the income derived from sources within 
Puerto Rico which is attributable to that part of such period of Puerto 
Rican residence which preceded the date of such change in residence, 
except amounts received for services performed as an employee of the 
United States or any agency thereof.
    (c) Deductions. In any case in which any amount otherwise 
constituting gross income is excluded from gross income under the 
provisions of section 933, there shall not be allowed as a deduction 
from gross income any items of expenses or losses or other deductions 
(except the deduction under section 151, relating to personal 
exemptions) properly allocable to, or chargeable against, the amounts so 
excluded from gross income.