Puerto Rico Child Care Tax Incentives

Current for 2026 Tax Year • Last Updated: January 24, 2026

Federal 45F (for US Filers) + ACUDEN ContiGO Vouchers (for Local Businesses)

🚨 CRITICAL: 45F May NOT Apply to Your Business

Section 45F is a Federal Tax Credit that only offsets US Federal Income Tax. Most Puerto Rican corporations that file only with Hacienda (Form 480.2) pay 0% Federal Income Tax, making the 45F credit completely useless to them.

Who CAN claim 45F: US-based employers with operations in Puerto Rico (e.g., Pharma/Tech branches) or local entities that file a US Federal Tax Return (Form 1120-F).

The Puerto Rico Reality: Two Different Strategies

40-50% Federal 45F (US Filers Only)

If you file a US Federal Tax Return, claim 40-50% of qualified child care expenses, up to $600,000 annually.

OR
ACUDEN ContiGO Vouchers (Local Businesses)

If you file only with Hacienda, help employees access ACUDEN ContiGO vouchers—effectively subsidizing their care at no cost to you.

🇵🇷 For Local PR Businesses: ACUDEN ContiGO

If you can't claim the Federal 45F Credit, this is your move.

ACUDEN ContiGO: The Real Benefit for Local Employers

  • The Program: ACUDEN ContiGO (launched August 2025) is administered by the Administración para el Cuidado y Desarrollo Integral de la Niñez
  • The Benefit: Direct financial assistance (vouchers) to working families to pay for child care
  • The Strategy: Help your employees apply for these vouchers—effectively subsidizing their care at no cost to you
  • Your Role: Provide employment verification and facilitate the application process

💡 The "Facilitator" Strategy

"If you're a local San Juan bakery filing only a Hacienda return (Form 480.2), you cannot claim 45F. But you CAN become a hero to your employees by helping them navigate ACUDEN ContiGO. Set up an HR process to assist with applications—it costs you nothing but builds massive loyalty."

💊 PR Success Story: Medtronic (Ponce)

Puerto Rico is the pharmaceutical manufacturing capital of the US. Medtronic is the gold standard.

The Medtronic Model: US Benefits Package in PR

  • The Reality: Medtronic's Ponce facility doesn't just rely on local options—they imported their US-style benefits package
  • Backup Care: They offer Backup Care via Bright Horizons for emergencies
  • Family Building: Extensive Fertility/Family Building benefits
  • The 45F Angle: They use their US tax liability to fund world-class family benefits for their Puerto Rico workforce

🎯 The Lesson for US Subsidiaries

"Medtronic competes for talent on a global scale. They use their US tax liability to fund world-class family benefits for their Puerto Rico workforce. If you are a US subsidiary, this is your playbook. Claim 45F on your US return, deploy the savings in PR."

For US-Filing Employers: The 45F Strategy

If you file a US Federal Tax Return (Form 1120, 1120-F, etc.), here's how 45F works in PR.

ComponentAmountNotes
Annual Child Care Investment$300,000Backup care, stipends, facility costs
Federal 45F Credit (50%)-$150,000Claimed on US Federal Return
Business Expense Deduction (~25%)-$75,000Reduces US taxable income
Your Net Cost~$75,00075% savings!

⚠️ Reminder: This Only Works for US Federal Filers

If your PR entity files only with Hacienda (Form 480.2) and has no US Federal tax liability, you cannot claim this credit. Pivot to the ACUDEN ContiGO strategy instead.

Puerto Rico Compliance & Resources

🇵🇷 ACUDEN ContiGO

The primary child care voucher program for working families in Puerto Rico.

Departamento de la Familia →

📋 Child Care Licensing

ACUDEN (Administración para el Cuidado y Desarrollo Integral de la Niñez) handles licensing.

ACUDEN →

📄 Federal Form 8882

For US Federal filers: File IRS Form 8882 to claim the Section 45F credit.

IRS Form 8882 →

💼 Hacienda (Local Filers)

For local businesses: File with Hacienda. 45F does NOT apply to PR-only returns.

Hacienda →

Puerto Rico Child Care Landscape

45FUS Filers Only
ACUDENContiGO Vouchers
PharmaManufacturing Hub

Key Puerto Rico Markets

Major employers leveraging child care strategies:

  • San Juan Metro – Finance, tech, hospitality, government
  • Ponce – Pharmaceutical manufacturing (Medtronic, Pfizer)
  • Aguadilla – Aerospace, manufacturing
  • Caguas – Manufacturing, logistics
  • Mayagüez – University, pharma, tuna processing
  • Fajardo – Tourism, hospitality

Puerto Rico Child Care FAQ

Can local Puerto Rico businesses claim the federal 45F credit?
Generally NO. Section 45F is a Federal Tax Credit that only offsets US Federal Income Tax. Most Puerto Rican corporations that file only with Hacienda (Form 480.2) pay 0% Federal Income Tax, making 45F useless to them. Only US-based employers with PR operations or local entities that file a US Federal Tax Return (Form 1120-F) can claim 45F.
What is ACUDEN ContiGO?
ACUDEN ContiGO is a voucher program launched in August 2025 by the Administración para el Cuidado y Desarrollo Integral de la Niñez. It provides direct financial assistance to working families to pay for child care. This is the primary benefit for local Puerto Rico employers who cannot claim 45F—help your employees apply!
How does Medtronic handle child care in Puerto Rico?
Medtronic's Ponce facility uses their US tax liability to fund world-class family benefits for their Puerto Rico workforce, including Backup Care via Bright Horizons and extensive Fertility/Family Building benefits. This is the model for US subsidiaries operating in PR.
I'm a US company with operations in PR. Can I claim 45F?
Yes! If you file a US Federal Tax Return (Form 1120, 1120-F, etc.) and have US Federal tax liability, you can claim the 45F credit for child care expenses related to your PR workforce. File IRS Form 8882 with your US return.
Which agency handles child care in Puerto Rico?
The Departamento de la Familia through ACUDEN (Administración para el Cuidado y Desarrollo Integral de la Niñez) handles child care programs and licensing in Puerto Rico.

Ready to Navigate Puerto Rico Child Care Benefits?

Use our calculator to estimate Federal 45F savings (for US filers) or contact us for ACUDEN guidance!

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