Modifies the Internal Revenue Code’s sourcing rules for sales of personal property in U.S. possessions by inserting new text after IRC section 865(j)(3). The change affects how income from those sales is sourced for U.S. tax purposes and applies to taxable years beginning after December 31, 2023.

The amendment is narrowly focused on sourcing of sales of personal property in possessions and will primarily affect taxpayers and businesses that buy, sell, or ship personal property to or within U.S. possessions, as well as tax advisors and the IRS for implementation and compliance purposes.