P.R. Laws tit. 13, § 30174
(a) General rule. — The amount of any deduction or credit allowed by this part shall be taken for the taxable year in which they were “paid and incurred” or “paid and accrued” depending on the method of accounting used in computing taxable income, unless that to clearly reflect the income, the deductions and the credit, these should be claimed in another period. In the case of the death of a taxpayer whose taxable income is computed under an accrual method of accounting, any amount accrued as a deduction or credit only by reason of the death of the taxpayer shall not be allowed in computing taxable income for the period in which falls the date of the taxpayer’s death.
(b) Interests, rentals and other pre-paid expenses. —
(1) In general. — If a taxpayer determines his/her net income based on the cash receipts and disbursements method of accounting, the interests, rentals and other expenses paid by such taxpayer which, under the regulations prescribed by the Secretary, are treated as allocable to any period occurring after the close of the taxable year in which they are paid, shall be charged to the capital account and treated as paid in the period during which they are allocable.
(2) Exception. — This subsection shall not apply to the points paid on indebtedness incurred for the acquisition, construction, or improvement of, and secured by the principal residence of the taxpayer to the extent that, under the regulations prescribed by the Secretary, such payment of points is an established business practice in the area in which such indebtedness is incurred, and the amount of such payment does not exceed the amount generally charged in such area.
History —Jan. 31, 2011, No. 1, § 1040.04, retroactive to Jan. 1, 2011.