Territorial Tax Parity Act of 2025

The Territorial Tax Parity Act of 2025 modifies U.S. tax rules for income earned in U.S. territories like Puerto Rico and Guam. It requires that income from territories must be tied to a U.S. office or business to qualify for different tax treatment under current rules. Specifically, it adds a requirement that such income must be attributable to a U.S. office (determined under existing tax rules) before it can be taxed differently. This change applies to taxable years starting after December 31, 2024, affecting businesses operating in territories that earn income from U.S. sources.