[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4124 Introduced in House (IH)]







104th CONGRESS
  2d Session
                                H. R. 4124

 To amend the Internal Revenue Code of 1986 to provide that the denial 
  of deduction for excessive employee compensation shall apply to all 
employees and to expand the types of compensation to which such denial 
                                applies.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           September 19, 1996

Mr. Klink  (for himself, Mr. Murtha, Mr. Lewis of Georgia, Mr. Barrett 
 of Wisconsin, Mr. Owens, Mr. LaFalce, Mr. Hilliard, Mr. Dellums, and 
  Mr. Evans) introduced the following bill; which was referred to the 
                      Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
 To amend the Internal Revenue Code of 1986 to provide that the denial 
  of deduction for excessive employee compensation shall apply to all 
employees and to expand the types of compensation to which such denial 
                                applies.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. EXPANSION OF DENIAL OF DEDUCTION FOR EXCESSIVE EMPLOYEE 
              COMPENSATION.

    (a) Denial of Deduction To Apply to All Employees.--
            (1) In general.--Subsection (m) of section 162 of the 
        Internal Revenue Code of 1986 (relating to denial of deduction 
        for certain excessive employee compensation) is amended by 
        striking ``covered employee'' each place it appears and 
        inserting ``employee.''
            (2) Conforming amendment.--Subsection (m) of section 162 of 
        such Code is amended by striking paragraph (3) and 
        redesignating paragraph (4) as paragraph (3).
    (b) Repeal of Exceptions for Certain Types of Compensation.--
            (1) In general.--Paragraph (3) of section 162(m) of such 
        Code (as redesignated by subsection (a)) is amended by striking 
        subparagraphs (B) and (C) and by redesignating subparagraphs 
        (D), (E), and (F) as subparagraphs (B), (C), and (D), 
        respectively.
            (2) Binding contracts.--Subparagraph (B) of section 
        162(m)(3) (as so redesignated) is amended to read as follows:
                    ``(B) Exception for existing binding contracts.--
                            ``(i) In general.--The term `applicable 
                        employee remuneration' shall not include any 
                        remuneration--
                                    ``(I) which is payable under a 
                                written binding contract which was in 
                                effect on February 17, 1993, and
                                    ``(II) which was not modified 
                                thereafter in any material respect 
                                before such remuneration is paid.
                            ``(ii) Special rule.--Clause (i)(I) shall 
                        be applied by substituting `July 23, 1996' for 
                        `February 17, 1993' in the case of--
                                    ``(I) an employee who would not 
                                have been a covered employee as defined 
                                in this subsection as in effect on the 
                                day before the date of the enactment of 
                                this sentence, and
                                    ``(II) remuneration which would not 
                                have been applicable remuneration by 
                                reason of subparagraph (B) or (C) of 
                                paragraph (4) of this subsection as so 
                                in effect.''
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.
                                 <all>