[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2307 Introduced in House (IH)]






109th CONGRESS
  1st Session
                                H. R. 2307

 To amend the Internal Revenue Code of 1986 to treat certain payments 
 made to the European Union in lieu of income taxes to a member of the 
 European Union as income taxes paid to a foreign country for purposes 
                       of the foreign tax credit.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 11, 2005

   Mr. Udall of New Mexico 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 treat certain payments 
 made to the European Union in lieu of income taxes to a member of the 
 European Union as income taxes paid to a foreign country for purposes 
                       of the foreign tax credit.

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

SECTION 1. CERTAIN PAYMENTS MADE TO EUROPEAN UNION IN LIEU OF INCOME 
              TAX TO A MEMBER OF THE EUROPEAN UNION TREATED AS INCOME 
              TAX PAID TO A FOREIGN COUNTRY.

    (a) In General.--Section 903 of the Internal Revenue Code of 1986 
(relating to credit for taxes in lieu of income, etc., taxes) is 
amended to read as follows:

``SEC. 903. CREDIT FOR TAXES IN LIEU OF INCOME, ETC., TAXES.

    ``For purposes of this part and of sections 164(a) and 275(a)--
            ``(1) the term `income, war profits, and excess profits 
        taxes' shall include a tax paid in lieu of a tax on income, war 
        profits, or excess profits otherwise generally imposed by any 
        foreign country or by any possession of the United States, and
            ``(2) in the case of an individual, any payment to the 
        European Union shall be treated as an income tax paid to a 
        foreign country if such payment is--
                    ``(A) determined on the basis of compensation 
                (including any health, pension, retirement, or other 
                benefits) paid by the European Union to such individual 
                for services performed by such individual for the 
                European Union, and
                    ``(B) paid in lieu of an income tax otherwise 
                generally imposed by any foreign country which is a 
                member of the European Union.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to payments made after the date of the enactment of this Act, in 
taxable years ending after such date.
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