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U.S. Virgin Islands EDC Tax Benefit Estimator (2026-2030)

Economic Development Commission  •  90% Income Tax Reduction  •  Mirror Code System  •  PR vs. USVI Comparison
IRC §932 IRC §934 IRC §937 Treas. Reg. §1.937-1 USVI EDC Program 29 V.I.C. §713b
Last verified: October 29, 2026. Tax years 2026-2030. 2026 federal bracket figures are IRS-published (Rev. Proc. 2025-32). Figures for 2027-2030 marked Projected - estimate, not IRS-published are projections using the inflation assumption you set below. The Virgin Islands EDC statutory amounts (90% reduction, $100,000 investment, employee minimums, $3,000 scholarship contribution, fee schedule, benefit terms) are taken from the 2019 published text of Title 29 V.I.C. and the Economic Development Authority's September 18, 2024 summary; a newer code edition exists and was not retrievable, so confirm them before relying on this page.
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Tax Year & Filing Assumptions

Drives the income tax brackets, standard deduction, and capital gain thresholds. The U.S. Virgin Islands applies the Internal Revenue Code as its own income tax (the mirror code, 48 U.S.C. §1397), so the same bracket figures are used for the Virgin Islands return and for the mainland baseline.
Enter household amounts below if married filing jointly. Standard deduction assumed; itemized deductions, credits, and adjustments are not modeled.
Used only for 2027-2030 bracket indexing. Default 2.5%. IRC §1(f)(3), §1(j)(3) index to chained CPI-U.
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Eligibility Assessment

Bona fide residency requires the presence test, the tax home test, and the closer connection test. 183 days is one of five alternative presence tests. IRC §937(a); Treas. Reg. §1.937-1(c)(1).
Treas. Reg. §1.937-1(d); IRC §911(d)(3) principles.
Treas. Reg. §1.937-1(e); IRC §7701(b)(3)(B)(ii) principles.
29 V.I.C. §708(f): 10 full-time resident employees; 5 for a Category IIA non-labor-intensive financial services enterprise. The Authority's summary states 5 for Category IV and Category V. Verify which applies.
29 V.I.C. §708(a): at least $100,000, exclusive of inventory. The Commission may reduce the minimum in exchange for other investment (workforce development, public education, and similar).
Category IV designated service businesses are described as serving clients located outside the Virgin Islands (Authority summary, revised September 18, 2024).
Maps to the fee category in 29 V.I.C. §708a. Knowledge-based and e-commerce applicants are referred to RTPark (Authority summary).
RTPark benefits are described as up to a 90% reduction with a term generally of 15 years (RTPark summary). RTPark admission rules are not verified here.
Sets the benefit term shown in the compliance costs: 20 years (St. Thomas / St. John) or 30 years (St. Croix). 29 V.I.C. §713a(b).
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Income Profile (Selected Tax Year)

Under the mirror code, a bona fide USVI resident files one income tax return with the Virgin Islands Bureau of Internal Revenue reporting income from all sources, and that income is excluded from U.S. gross income when the conditions of IRC §932(c)(4) are met. The EDC reduction applies only to tax attributable to income from Virgin Islands sources or income effectively connected with a Virgin Islands trade or business (IRC §934(b)(1)). All amounts are in U.S. dollars for the year selected above.

A corporation is taxed at the entity level at 21% (IRC §11(b)) plus the 10% Virgin Islands corporate surtax. A pass-through owner is taxed on the distributive share at individual rates.
90% for certificate holders (29 V.I.C. §713b(a), (b)); the Commission may approve a lesser percentage (§713a(b)). Capped at 90% here.
Whether the net investment income tax applies to bona fide USVI residents is disputed (secondary source). The conservative choice applies it to dividends and other investment income. The 90% reduction is not applied to the NIIT. IRC §1411.
C corporation: net taxable income of the entity. Pass-through: your distributive share, taxed to you whether or not distributed.
Income from sources outside the Virgin Islands, or effectively connected with a U.S. trade or business, is outside the reduction. IRC §934(b)(1). Enter 0 if all income is Virgin Islands-source.
Assumed qualified dividends (0/15/20%). C corporation only; ignored for a pass-through, whose distributions of taxed income are not taxed again. Owner reduction: 29 V.I.C. §713b(e)(2).
Wages, interest, rents, and other income outside the EDC business. Taxed on the Virgin Islands return at the regular mirror-code rates with no reduction (IRC §934(a)). Treated as not net investment income.
Taxed at 0/15/20% (IRC §1(h)) with no reduction. Treated as net investment income.
Optional. Enter the incremental annual payroll cost of the 5 or 10 required full-time resident employees to net it against the tax savings.
Top marginal individual rates as of January 1, 2026 (Tax Foundation compilation; verify). Applied as a flat rate to individual-level income in the mainland baseline. Held constant for 2027-2030 (Projected assumption). State corporate tax is not modeled.
Washington taxes long-term capital gains only (excise tax), so a Washington selection applies this custom rate to the long-term gains field only.
Mirror code (48 U.S.C. §1397; IRC §932): The Virgin Islands does not write its own income tax code. The Internal Revenue Code applies in the Virgin Islands with the Virgin Islands substituted for the United States, and the proceeds go to the Virgin Islands treasury. IRC §934(a) bars reducing that tax except as §934(b) allows, and §934(b)(1) allows a reduction only for tax attributable to Virgin Islands-source or effectively connected income. The Legislature may levy a surtax of up to 10% (48 U.S.C. §1397); corporations pay it on Form 1120ES-VI.
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EDC Tax Savings Analysis

Tax Without EDC
$0
Mainland: entity tax + federal + NIIT + state
Tax With USVI EDC
$0
Virgin Islands entity tax + individual tax after reduction
Estimated Annual Savings
$0
Before compliance costs

Detailed Tax Comparison

Income Category Amount Without EDC With EDC Savings
Total $0 $0 $0 $0
Individual-level tax is allocated to each category by its share of total individual income (average-rate method); net investment income tax is allocated by its share of net investment income. The EDC reduction applies to the tax attributable to qualifying business and dividend income. The Bureau of Internal Revenue's attribution method is not verified; the step-by-step math shows the range if EDC income is stacked first or last.

Other Benefits Described by the Authority

Gross Receipts Tax
100%
Exemption on gross receipts of the benefited business; may be narrowed in the beneficiary's contract. Not included in the savings figure above. Authority summary (revised September 18, 2024).
Property Tax
100%
Applies only to real property owned by the beneficiary and used in the benefited business. Not included in the savings figure above. Authority summary.
Excise Tax / Customs
100% / 1%
Excise exemption covers equipment, raw materials, and construction materials for the physical plant. Customs duty of 1% instead of 6% on non-U.S. raw materials and components. Not included above. Authority summary.

EDC vs. RTPark - Which Program Track?

ItemEDC ProgramRTPark (Univ. of the Virgin Islands)
Income tax benefit90% reduction (29 V.I.C. §713b)Up to 90% reduction on qualifying income (RTPark summary)
Effective corporate rate at 90%2.31% (21% x 1.10 surtax x 10%)Same computation if the full 90% is approved
Owner distributions90% reduction on dividends and distributive shares (§713b(e)(2))90% on dividends; the summary states 100% on pass-through distributions (verify)
Benefit term20 years (St. Thomas / St. John), 30 years (St. Croix) (§713a(b))Generally 15 years (RTPark summary)
WithholdingNot addressed in the sources reviewedInterest exempt; 4% on dividends and royalties (RTPark summary)
Typical fitManufacturing, hospitality, designated service businesses, financial servicesTechnology, e-commerce, and knowledge-based businesses (Authority summary refers these to RTPark)

Annual Compliance Costs

Territorial Scholarship Fund
$3,000
Minimum annual contribution to the Board of Education for the Territorial Scholarship Fund. Not applicable to §708b beneficiaries. 29 V.I.C. §708(m) (2019 text).
Annual Compliance Fee
$0
Fee depends on the program category.
Required Employees
10
Full-time Virgin Islands residents. Payroll is the main practical cost of the program; enter it above to net it.
Benefit Term
20 years
29 V.I.C. §713a(b); extensions are available in some cases.
One-Time Fees
$0
Application and activation fees by category.
Net Annual Benefit (Est.)
$0
Enter income above to calculate.

Step-by-Step Math

Assumptions & sources (values for the selected tax year)
Sources fetched October 29, 2026: U.S. Virgin Islands Economic Development Authority, "Taxation Benefits for Approved Investors" (revised September 18, 2024), usvieda.org; RTPark, "Summary of USVI Tax Incentives for RTPark Approved Companies"; 29 V.I.C. §§708, 708a, 713a, 713b (Justia, 2019 edition); IRC §§932, 934, 937 (Cornell LII); 48 U.S.C. §1397 (Cornell LII); Treas. Reg. §1.937-1 (eCFR); Virgin Islands Bureau of Internal Revenue Form 1120ES-VI; Rev. Proc. 2025-32 (2026 inflation adjustments); state rates from the Tax Foundation 2026 compilation. The statement that the Virgin Islands levies no individual surtax and the discussion of the NIIT come from a secondary source (taxesforexpats.com) and are marked verify.
Projected figures are estimates. Bracket and threshold amounts for 2027-2030 are projections, not IRS-published figures, and will differ from the amounts actually published. EDC outcomes depend on the Commission's approval, the certificate terms, and Bureau of Internal Revenue and IRS positions that this tool cannot see. Not tax or legal advice.
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Puerto Rico Act 60 vs. USVI EDC - Side by Side

Puerto Rico - Act 60
USVI - EDC Program
Tax Rate on Qualifying Income
Individual Resident Investor: 0% on post-residency interest, dividends, and gains if the application is received by December 31, 2026; 4% if received on or after January 1, 2027 (Act 38-2026)
90% reduction in Virgin Islands income tax on qualifying Virgin Islands-source business income and owner distributions; 2.31% effective corporate rate at 90%
Employee Requirement
None for the Individual Resident Investor decree
10 full-time resident employees; 5 for certain financial and service categories (29 V.I.C. §708(f); verify category)
Minimum Investment
No dollar minimum; a Puerto Rico principal residence must be purchased within 2 years after the decree
$100,000 in an approved business, exclusive of inventory (29 V.I.C. §708(a))
Annual Statutory Costs
$15,000: $10,000 charitable contribution plus $5,000 annual report charge (Code §6020.10(b), (d))
$3,000 scholarship contribution plus an annual compliance fee of $1,500 to $7,500 by category (2019 text), plus employee payroll
Tax System
Puerto Rico Internal Revenue Code. Federal exclusion of Puerto Rico-source income only (IRC §933); U.S.-source income stays taxable by the IRS
IRC mirror code. A bona fide resident reporting all income to the Virgin Islands is excluded from U.S. gross income (IRC §932(c)(4)); the EDC reduction reaches only Virgin Islands-source or effectively connected income (§934(b))
Program Duration
Decree through December 31, 2035 (0% regime) or December 31, 2055 (4% regime)
20 years (St. Thomas / St. John) or 30 years (St. Croix), with possible extensions (29 V.I.C. §713a(b))
Application Deadline
December 31, 2026 (11:59 pm) for the 0% regime
No fixed filing deadline comparable to Act 60's was found in the sources reviewed. Confirm the current application calendar with the Authority.
Best For
Investors whose income is mainly interest, dividends, and capital gains, with no business or employees required
Operating businesses and service or financial firms with Virgin Islands-source income and capacity to hire resident employees
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The two programs are different jurisdictions and a taxpayer is generally resident in only one possession at a time. Consult a qualified CPA and attorney familiar with both before deciding. See the Puerto Rico Act 60 estimator on this site for the Act 60 side of the comparison.
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