Puerto Rico Statehood Impact Calculator

Net annual change in household disposable income — a scenario model

Median household Family of 4 Low-income senior Middle income

Household profile

$

Treated as earned income for EITC / refundable CTC. Default = PR median household income (Census ACS 2023).

Sensitivity toggles

1.0×

Scales Medicaid/Medicare support value. Conservative 0.6× → Optimistic 1.4×.

−25%

How much PR lowers its own income tax under statehood.

+0%

Manual net real-income adjustment on top of the scenario.

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New federal income taxⓘ
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EITC receivedⓘ
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Child Tax Creditⓘ
—
Local tax savingsⓘ
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Federal support valueⓘ
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Net cash change
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Cash + benefits
—
Net real (after COL)ⓘ

Disposable income comparison

Build-up to net change

Cost-of-living breakdown

Sensitivity: net real change by transfer × local-tax cut

Holds household profile fixed; varies the two policy levers.

Local tax unchangedLocal tax −25%Local tax −50%

How to read this & important caveats

  • • This is an educational scenario calculator, not tax advice, a benefit-eligibility determination, or an economic forecast. Actual statehood effects would depend on congressional implementing legislation.
  • • Federal taxes: uses 2025 IRS brackets, standard deduction, EITC, and Child Tax Credit. PR residents currently pay no federal income tax on PR-source income and are excluded from the EITC; under statehood they would pay federal income tax and gain credit eligibility. They already pay Social Security / Medicare payroll taxes, which are unchanged here.
  • • Child Tax Credit caveat: a limited refundable Additional CTC already exists for some Puerto Rico families with qualifying children. This tool models fuller CTC availability under statehood and may overstate the incremental gain for families already receiving ACTC.
  • • Medicaid & Medicare values are support value (insurance / access), not cash income. PR currently receives capped federal Medicaid funding (Section 1108) at a fixed FMAP; as a state it would receive open-ended, per-capita-income-based funding. Per-person figures are illustrative estimates scaled by the transfer multiplier.
  • • Cost-of-living effects are highly uncertain and modeled as adjustable assumptions reflecting aggregate demand, price, wage, and investment shifts — not predictions.
  • • Other items not modeled: itemized deductions and PR earned-income credits; high-income PR rate adjustments; SNAP, SSI, and other means-tested programs; transition effects on Act 60 / Section 936 incentives. Figures are rounded.

Sources & assumptions