< Back to H.R. 1801 (111th Congress, 2009–2010)

Text of To amend the Internal Revenue Code of 1986 to impose a 70 percent tax on certain compensation received from certain ...

...received from certain companies receiving Federal bailout funds.

This bill was introduced on March 30, 2009, in a previous session of Congress, but was not enacted. The text of the bill below is as of Mar 30, 2009 (Introduced).

Download PDF

Source: GPO

I

111th CONGRESS

1st Session

H. R. 1801

IN THE HOUSE OF REPRESENTATIVES

March 30, 2009

(for himself, Ms. Kaptur, Mr. Filner, Mr. Kucinich, and Mr. DeFazio) 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 impose a 70 percent tax on certain compensation received from certain companies receiving Federal bailout funds.

1.

Tax on certain compensation received from certain companies receiving bailout funds

(a)

In general

Subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new part:

VIII

Certain compensation received from certain companies receiving bailout funds

Sec. 59C. Certain compensation received from certain companies receiving bailout funds.

59C.

Certain compensation received from certain companies receiving bailout funds

(a)

In general

In the case of any employee (or former employee) of a bailout recipient, there is hereby imposed (in addition to any other tax imposed by this subtitle) a tax equal to 70 percent of the amount of excess compensation received by the taxpayer during the taxable year from any relevant employer.

(b)

Excess compensation

For purposes of this section—

(1)

In general

The term excess compensation means the value of all property paid or transferred to the employee during the taxable year (including any loan that is not reasonably secured) which is in excess of $1,000,000.

(2)

Exceptions

Such term shall not include any of the following:

(A)

Any amount returned by the employee to the employer within 60 days of receipt thereof or within 60 days of the enactment of this Act, whichever is later. Any amount returned under this subparagraph shall also be excluded from the definition of gross income.

(B)

To the extent explicitly allowed by any regulation adopted by the Secretary, shares of common stock of the employer (or any affiliate thereof) but only if the employee is required to hold such shares until the date on which the employer ceases to be a relevant employer.

(C)

Any amount received before the employer became a relevant employer or after the employer ceases to be a relevant employer, whether or not for services provided during the period when the employer was classified as a relevant employer, but this provision shall not apply if the payment is made out of assets which were held in trusts, or otherwise made unavailable to the claims of general creditors.

(D)

Any commission received by a commissioned sales person. For purposes of this subparagraph, a commission is an amount of compensation payable determinable solely by reference to the products sold by the commissioned sales person through direct interaction with purchasers. For purposes of this subparagraph, a commissioned sales person is a person who receives commissions, who spends the majority of their work time selling products directly to purchasers, and who is not one of the persons defined in Rule 16a1–(f) promulgated under the Securities Exchange Act of 1934.

(3)

Special rules for certain trusts

In the event that a relevant employer puts funds for the benefit of an employee, or a class of employees, in a trust fund (other than a qualified deferred compensation plan) or other device, which fund is exempt from the claims of the relevant employer’s general creditors, it shall be deemed paid to the employees for whom it is being held.

(c)

Relevant employer

For purposes of this section, the term relevant employer means any entity (including any subsidiary or affiliate of such entity) that has received, in the aggregate, more than $500,000,000 pursuant to title I of the Emergency Economic Stabilization Act of 2008 or pursuant to section 1117 of the Housing and Economic Recovery Act of 2008, regardless of whether such funds are received in return for any class of securities of the employer or any other asset. An employer ceases to be a relevant employer when it has fully repaid to the Federal Government all such funds.

(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.

.

(b)

Clerical amendment

The table of parts for subchapter A of chapter 1 of such Code is amended by adding at the end the following new item:

Part VIII—Certain compensation received from certain companies receiving bailout funds

.

(c)

Effective date

The amendments made by this section shall apply to compensation received after December 31, 2007, in taxable years ending after such date.