[Congressional Record Volume 163, Number 147 (Tuesday, September 12, 2017)]
[Senate]
[Pages S5230-S5231]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
SA 975. Ms. STABENOW submitted an amendment intended to be proposed
by her to the bill H.R. 2810, to authorize appropriations for fiscal
year 2018 for military activities of the Department of Defense, for
military construction, and for defense activities of the Department of
Energy, to prescribe military personnel strengths for such fiscal year,
and for other purposes; which was ordered to lie on the table; as
follows:
At the appropriate place, insert the following:
SEC. ___. BRINGING JOBS HOME.
(a) Tax Credit for Insourcing Expenses.--
(1) In general.--Subpart D of part IV of subchapter A of
chapter 1 of the Internal Revenue Code of 1986 is amended by
adding at the end the following new section:
``SEC. 45S. CREDIT FOR INSOURCING EXPENSES.
``(a) In General.--For purposes of section 38, the
insourcing expenses credit for any taxable year is an amount
equal to 20 percent of the eligible insourcing expenses of
the taxpayer which are taken into account in such taxable
year under subsection (d).
``(b) Eligible Insourcing Expenses.--For purposes of this
section--
``(1) In general.--The term `eligible insourcing expenses'
means--
``(A) eligible expenses paid or incurred by the taxpayer in
connection with the elimination of any business unit of the
taxpayer (or of any member of any expanded affiliated group
in which the taxpayer is also a member) located outside the
United States, and
``(B) eligible expenses paid or incurred by the taxpayer in
connection with the establishment of any business unit of the
taxpayer (or of any member of any expanded affiliated group
in which the taxpayer is also a member) located within the
United States,
if such establishment constitutes the relocation of the
business unit so eliminated. For purposes of the preceding
sentence, a relocation shall not be treated as failing to
occur merely because such elimination occurs in a different
taxable year than such establishment.
``(2) Eligible expenses.--The term `eligible expenses'
means--
``(A) any amount for which a deduction is allowed to the
taxpayer under section 162, and
``(B) permit and license fees, lease brokerage fees,
equipment installation costs, and, to the extent provided by
the Secretary, other similar expenses.
Such term does not include any compensation which is paid or
incurred in connection with severance from employment and, to
the extent provided by the Secretary, any similar amount.
``(3) Business unit.--The term `business unit' means--
``(A) any trade or business, and
``(B) any line of business, or functional unit, which is
part of any trade or business.
``(4) Expanded affiliated group.--The term `expanded
affiliated group' means an affiliated group as defined in
section 1504(a), determined without regard to section
1504(b)(3) and by substituting `more than 50 percent' for `at
least 80 percent' each place it appears in section 1504(a). A
partnership or any other entity (other than a corporation)
shall be treated as a member of an expanded affiliated group
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
paragraph).
``(5) Expenses must be pursuant to insourcing plan.--
Amounts shall be taken into account under paragraph (1) only
to the extent that such amounts are paid or incurred pursuant
to a written plan to carry out the relocation described in
paragraph (1).
``(6) Operating expenses not taken into account.--Any
amount paid or incurred in connection with the on-going
operation of a business unit shall not be treated as an
amount paid or incurred in connection with the establishment
or elimination of such business unit.
``(c) Increased Domestic Employment Requirement.--No credit
shall be allowed under this section unless the number of
full-time equivalent employees of the taxpayer for the
taxable year for which the credit is claimed exceeds the
number of full-time equivalent employees of the taxpayer for
the last taxable year ending before the first taxable year in
which such eligible insourcing expenses were paid or
incurred. For purposes of this subsection, full-time
equivalent employees has the meaning given such term under
section 45R(d) (and the applicable rules of section 45R(e)).
All employers treated as a single employer under subsection
(b), (c), (m), or (o) of section 414 shall be treated as a
single employer for purposes of this subsection.
``(d) Credit Allowed Upon Completion of Insourcing Plan.--
``(1) In general.--Except as provided in paragraph (2),
eligible insourcing expenses shall be taken into account
under subsection (a) in the taxable year during which the
plan described in subsection (b)(5) has been completed and
all eligible insourcing expenses pursuant to such plan have
been paid or incurred.
``(2) Election to apply employment test and claim credit in
first full taxable year after completion of plan.--If the
taxpayer elects the application of this paragraph, eligible
insourcing expenses shall be taken into account under
subsection (a) in the first taxable year after the taxable
year described in paragraph (1).
``(e) Possessions Treated as Part of the United States.--
For purposes of this section, the term `United States' shall
be treated as including each possession of the United States
(including the Commonwealth of Puerto Rico and the
Commonwealth of the Northern Mariana Islands).
``(f) Regulations.--The Secretary shall prescribe such
regulations or other guidance as may be necessary or
appropriate to carry out the purposes of this section.''.
(2) Credit to be part of general business credit.--
Subsection (b) of section 38 of such Code is amended by
striking ``plus'' at the end of paragraph (35), by striking
the period at the end of paragraph (36) and inserting ``,
plus'', and by adding at the end the following new paragraph:
``(37) the insourcing expenses credit determined under
section 45S(a).''.
(3) Clerical amendment.--The table of sections for subpart
D of part IV of subchapter A of chapter 1 of such Code is
amended by adding at the end the following new item:
``Sec. 45S. Credit for insourcing expenses.''.
(4) Effective date.--The amendments made by this subsection
shall apply to amounts paid or incurred after the date of the
enactment of this Act.
(5) Application to united states possessions.--
(A) Payments to possessions.--
(i) Mirror code possessions.--The Secretary of the Treasury
shall make periodic payments to each possession of the United
States with a mirror code tax system in an amount equal to
the loss to that possession by reason of section 45S of the
Internal Revenue Code of 1986. Such amount shall be
determined by the Secretary of the Treasury based on
information provided by the government of the respective
possession.
(ii) Other possessions.--The Secretary of the Treasury
shall make annual payments to
[[Page S5231]]
each possession of the United States which does not have a
mirror code tax system in an amount estimated by the
Secretary of the Treasury as being equal to the aggregate
benefits that would have been provided to residents of such
possession by reason of section 45S of such Code if a mirror
code tax system had been in effect in such possession. The
preceding sentence shall not apply with respect to any
possession of the United States unless such possession has a
plan, which has been approved by the Secretary of the
Treasury, under which such possession will promptly
distribute such payment to the residents of such possession.
(B) Coordination with credit allowed against united states
income taxes.--No credit shall be allowed against United
States income taxes under section 45S of such Code to any
person--
(i) to whom a credit is allowed against taxes imposed by
the possession by reason of such section, or
(ii) who is eligible for a payment under a plan described
in subparagraph (A)(i).
(C) Definitions and special rules.--
(i) Possessions of the united states.--For purposes of this
section, the term ``possession of the United States''
includes the Commonwealth of Puerto Rico and the Commonwealth
of the Northern Mariana Islands.
(ii) Mirror code tax system.--For purposes of this section,
the term ``mirror code tax system'' means, with respect to
any possession of the United States, the income tax system of
such possession if the income tax liability of the residents
of such possession under such system is determined by
reference to the income tax laws of the United States as if
such possession were the United States.
(iii) Treatment of payments.--For purposes of section
1324(b)(2) of title 31, United States Code, the payments
under this subsection shall be treated in the same manner as
a refund due from sections referred to in such section
1324(b)(2).
(b) Denial of Deduction for Outsourcing Expenses.--
(1) In general.--Part IX of subchapter B of chapter 1 of
the Internal Revenue Code of 1986 is amended by adding at the
end the following new section:
``SEC. 280I. OUTSOURCING EXPENSES.
``(a) In General.--No deduction otherwise allowable under
this chapter shall be allowed for any specified outsourcing
expense.
``(b) Specified Outsourcing Expense.--For purposes of this
section--
``(1) In general.--The term `specified outsourcing expense'
means--
``(A) any eligible expense paid or incurred by the taxpayer
in connection with the elimination of any business unit of
the taxpayer (or of any member of any expanded affiliated
group in which the taxpayer is also a member) located within
the United States, and
``(B) any eligible expense paid or incurred by the taxpayer
in connection with the establishment of any business unit of
the taxpayer (or of any member of any expanded affiliated
group in which the taxpayer is also a member) located outside
the United States,
if such establishment constitutes the relocation of the
business unit so eliminated. For purposes of the preceding
sentence, a relocation shall not be treated as failing to
occur merely because such elimination occurs in a different
taxable year than such establishment.
``(2) Application of certain definitions and rules.--
``(A) Definitions.--For purposes of this section, the terms
`eligible expenses', `business unit', and `expanded
affiliated group' shall have the respective meanings given
such terms by section 45S(b).
``(B) Operating expenses not taken into account.--A rule
similar to the rule of section 45S(b)(6) shall apply for
purposes of this section.
``(c) Special Rules.--
``(1) Application to deductions for depreciation and
amortization.--In the case of any portion of a specified
outsourcing expense which is not deductible in the taxable
year in which paid or incurred, such portion shall neither be
chargeable to capital account nor amortizable.
``(2) Possessions treated as part of the united states.--
For purposes of this section, the term `United States' shall
be treated as including each possession of the United States
(including the Commonwealth of Puerto Rico and the
Commonwealth of the Northern Mariana Islands).
``(d) Regulations.--The Secretary shall prescribe such
regulations or other guidance as may be necessary or
appropriate to carry out the purposes of this section,
including regulations which provide (or create a rebuttable
presumption) that certain establishments of business units
outside the United States will be treated as relocations
(based on timing or such other factors as the Secretary may
provide) of business units eliminated within the United
States.''.
(2) Limitation on subpart f income of controlled foreign
corporations determined without regard to specified
outsourcing expenses.--Subsection (c) of section 952 of such
Code is amended by adding at the end the following new
paragraph:
``(4) Earnings and profits determined without regard to
specified outsourcing expenses.--For purposes of this
subsection, earnings and profits of any controlled foreign
corporation shall be determined without regard to any
specified outsourcing expense (as defined in section
280I(b)).''.
(3) Clerical amendment.--The table of sections for part IX
of subchapter B of chapter 1 of such Code is amended by
adding at the end the following new item:
``Sec. 280I. Outsourcing expenses.''.
(4) Effective date.--The amendments made by this subsection
shall apply to amounts paid or incurred after the date of the
enactment of this Act.
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