Utah founders are moving to Puerto Rico: Because tax benefits.

• Author: Austin, Rebekah

"GROW IS STILL HEADQUARTERED IN Provo, Utah, but for my family and me, Puerto Rico is our home base," says Rob Nelson, founder and CEO at Grow.

He's speaking with me from his home, just a few miles from Dorado, PR, where he and his family moved this year. "It's a big transition, and we're excited. We have friends who live in Puerto Rico, and they love it here," he says. "People come with a 2-3 year plan but end up staying for much longer."

Nelson is a hands-on CEO, but says the pandemic taught him that working and managing employees remotely is possible, no matter where you are. "This last year was the most productive and profitable year for us. It has shown us that work-from-home culture works. Although we will move into the hybrid work-from-home and office model, it is a reflection of our internal culture--and it's good."

He's not the only one who made the move.

PUERTO RICO OFFERS TAX BREAKS FOR INDIVIDUALS AND BUSINESSES

This small island, south of Haiti and north of South American countries like Venezuela, has endured the same financial crises that the states experienced, but for longer periods of time and at an obvious difference in scale.

The first series of tax breaks--which enticed corporations to move to Puerto Rico--expired in 2006, leading to an exodus of business and jobs for Puerto Ricans. Residents were left with a drastically lowered bond rate, as well as a hobbled economy and big financial institutions swooped in, offering quick cash with astronomically high interest rates.

Already struggling with the rigors of island life-household energy is three times more expensive in Puerto Rico than the average US household and 85 percent of their produce is imported from other countries--Puerto Rico is now more than $70 billion in debt and has no plan to pay it off.

Puerto Rico has struggled to make payments on its ever-increasing debt and continues to go through a series of debt reconstruction and refinancing efforts. Financial institutions, like Citi Bank, which hold Puerto Rico's debt, make their money not by reconfiguring the loans but from fees stipulated in their decade-old agreement.

That's why Puerto Rico passed two laws in 2012 to mark itself as a global investment destination. Act 20 allows for corporations who export services off the island only to pay 4 percent in taxes. Act 22 kicks it up a notch: Puerto Rico is the only place on US soil where personal income from capital gains, interest, and dividends are untaxed for...