Stop Corporate Inversions Act of 2024

Taxation
senate
house
president

Introduced on May 7, 2024 by Richard Joseph Durbin

Cosponsors

Legislation Details

  • Amends the Internal Revenue Code of 1986 to modify rules related to inverted corporations.
  • Treats a foreign corporation as a domestic corporation if:
    • The corporation would be a surrogate foreign corporation with an 80 percent threshold instead of 60 percent.
    • The corporation is an inverted domestic corporation.
  • Defines an inverted domestic corporation as a foreign corporation that acquires substantially all properties or assets of a U.S. corporation or partnership after May 8, 2014, and either:
    • More than 50 percent of the stock is held by former shareholders or partners due to the acquisition.
    • The management and control of the expanded affiliated group occur primarily within the United States, and the group has significant domestic business activities.
  • Excludes a foreign corporation from being treated as an inverted domestic corporation if the expanded affiliated group has substantial business activities in the foreign country of organization, using the definition of substantial business activities from regulations in effect on January 18, 2017.
  • Specifies that management and control are considered to occur primarily within the United States if substantially all executive officers and senior management responsible for strategic, financial, and operational policies are based or primarily located within the United States.
  • Defines significant domestic business activities for an expanded affiliated group as having at least 25 percent of employees, employee compensation, assets, or income based or derived in the United States.
  • Makes conforming amendments to other sections of the Internal Revenue Code as related to the treatment of inverted corporations.
  • Applies the amendments to taxable years ending after May 8, 2014.

Last updated 9/4/2024