[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 2775 Introduced in Senate (IS)]







110th CONGRESS
  2d Session
                                S. 2775

To amend the Internal Revenue Code of 1986 and the Social Security Act 
  to treat certain domestically controlled foreign persons performing 
 services under contract with the United States Government as American 
    employers for purposes of certain employment taxes and benefits.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             March 13, 2008

   Mr. Kerry (for himself, Mr. Obama, Mr. Harkin, and Mrs. Clinton) 
introduced the following bill; which was read twice and referred to the 
                          Committee on Finance

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 and the Social Security Act 
  to treat certain domestically controlled foreign persons performing 
 services under contract with the United States Government as American 
    employers for purposes of certain employment taxes and benefits.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Fair Share Act of 2008''.

SEC. 2. CERTAIN DOMESTICALLY CONTROLLED FOREIGN PERSONS PERFORMING 
              SERVICES UNDER CONTRACT WITH UNITED STATES GOVERNMENT 
              TREATED AS AMERICAN EMPLOYERS.

    (a) FICA Taxes.--Section 3121 of the Internal Revenue Code of 1986 
(relating to definitions) is amended by adding at the end the following 
new subsection:
    ``(z) Treatment of Certain Foreign Persons as American Employers.--
            ``(1) In general.--If any employee of a foreign person is 
        performing services in connection with a contract between the 
        United States Government (or any instrumentality thereof) and 
        any member of any domestically controlled group of entities 
        which includes such foreign person, such foreign person shall 
        be treated for purposes of this chapter as an American employer 
        with respect to such services performed by such employee.
            ``(2) Domestically controlled group of entities.--For 
        purposes of this subsection--
                    ``(A) In general.--The term `domestically 
                controlled group of entities' means a controlled group 
                of entities the common parent of which is a domestic 
                corporation.
                    ``(B) Controlled group of entities.--The term 
                `controlled group of entities' means a controlled group 
                of corporations as defined in section 1563(a)(1), 
                except that--
                            ``(i) `more than 50 percent' shall be 
                        substituted for `at least 80 percent' each 
                        place it appears therein, and
                            ``(ii) the determination shall be made 
                        without regard to subsections (a)(4) and (b)(2) 
                        of section 1563.
                A partnership or any other entity (other than a 
                corporation) shall be treated as a member of a 
                controlled group of entities if such entity is 
                controlled (within the meaning of section 954(d)(3)) by 
                members of such group (including any entity treated as 
                a member of such group by reason of this sentence).
            ``(3) Liability of common parent.--In the case of a foreign 
        person who is a member of any domestically controlled group of 
        entities, the common parent of such group shall be jointly and 
        severally liable for any tax under this chapter for which such 
        foreign person is liable by reason of this subsection.
            ``(4) Cross reference.--For relief from taxes in cases 
        covered by certain international agreements, see sections 
        3101(c) and 3111(c).''.
    (b) Social Security Benefits.--Subsection (e) of section 210 of the 
Social Security Act (42 U.S.C. 410(e)) is amended--
            (1) by striking ``(e) The term'' and inserting ``(e)(1) The 
        term'',
            (2) by redesignating paragraphs (1) through (6) as 
        subparagraphs (A) through (F), respectively, and
            (3) by adding at the end the following new paragraph:
            ``(2)(A) If any employee of a foreign person is performing 
        services in connection with a contract between the United 
        States Government (or any instrumentality thereof) and any 
        member of any domestically controlled group of entities which 
        includes such foreign person, such foreign person shall be 
        treated for purposes of this chapter as an American employer 
        with respect to such services performed by such employee.
            ``(B) For purposes of this paragraph--
                    ``(i) The term `domestically controlled group of 
                entities' means a controlled group of entities the 
                common parent of which is a domestic corporation.
                    ``(ii) The term `controlled group of entities' 
                means a controlled group of corporations as defined in 
                section 1563(a)(1) of the Internal Revenue Code of 
                1986, except that--
                            ``(I) `more than 50 percent' shall be 
                        substituted for `at least 80 percent' each 
                        place it appears therein, and
                            ``(II) the determination shall be made 
                        without regard to subsections (a)(4) and (b)(2) 
                        of section 1563 of such Code.
                A partnership or any other entity (other than a 
                corporation) shall be treated as a member of a 
                controlled group of entities if such entity is 
                controlled (within the meaning of section 954(d)(3) of 
                such Code) by members of such group (including any 
                entity treated as a member of such group by reason of 
                this sentence).''.
    (c) Effective Date.--The amendment made by this section shall apply 
to services performed after the date of the enactment of this Act.
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