No Dollars for Ayatollahs Act

Summary: No Dollars for Ayatollahs Act  This bill amends the Internal Revenue Code to impose an excise tax on any U.S. person who clears or transfers more than $1 million U.S. dollars per year for the direct or indirect benefit of the government of Iran or any Iranian person. The tax is equal to 100% of the amount that is cleared or transferred. The tax also applies to transactions by certain related entities, including the clearing or transferring of U.S dollars by: (1) a foreign member of a U.S. person's worldwide affiliated group, or (2) a foreign person who is not a member of a U.S. person's worldwide affiliated group, but has a correspondent account or payable-through account for or with such a member or a U.S. person. The tax applies to transactions by a foreign person described above if the member or U.S. person for or with whom the account is maintained knew or had reason to know the dollars were being cleared or transferred.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``No Dollars for Ayatollahs Act''.

SEC. 2. EXCISE TAX ON DOLLAR CLEARING TRANSACTIONS WITH RESPECT TO 
              IRAN.

    (a) In General.--Subtitle D of the Internal Revenue Code of 1986 is 
amended by adding at the end the following new chapter:

       ``CHAPTER 50A--CLEARING TRANSACTIONS WITH RESPECT TO IRAN

``Sec. 5000D. Imposition of tax on dollar clearing transactions with 
                            respect to Iran.

``SEC. 5000D. IMPOSITION OF TAX ON DOLLAR CLEARING TRANSACTIONS WITH 
              RESPECT TO IRAN.

    ``(a) Imposition of Tax.--There is hereby imposed on any United 
States person who clears or transfers United States dollars for the 
direct or indirect benefit of the Government of Iran or any Iranian 
person a tax equal to 100 percent of the dollar amount cleared or 
transferred.
    ``(b) Transaction by Certain Related Entities.--If any United 
States dollars are so cleared or transferred by--
            ``(1) a foreign member of a United States person's 
        worldwide affiliated group, or
            ``(2) a foreign person who--
                    ``(A) is not a member of a United States person's 
                worldwide affiliated group, but
                    ``(B) has a correspondent account or payable-
                through account for or with such a member or a United 
                States person,
such dollars shall be treated for purposes of subsection (a) as being 
cleared or transferred by the United States person. The preceding 
sentence shall apply with respect to a foreign person described in 
paragraph (2) only if the member or United States person, as the case 
may be, for or with whom the account is maintained knew or had reason 
to know such dollars were being so cleared or transferred.
    ``(c) Threshold Limitation.--
            ``(1) In general.--The tax imposed by subsection (a) shall 
        only apply with respect to a United States person for a 
        calendar year to the extent the dollar amounts so cleared or 
        transferred during the calendar year by such United States 
        person (including any such amounts treated under subsection (b) 
        as cleared or transferred by such person) exceed $1,000,000.
            ``(2) Members of group.--For purposes of paragraph (1), 
        amounts cleared or transferred by a non-foreign member of such 
        person's worldwide affiliated group shall be treated as cleared 
        or transferred by such person.
    ``(d) Definitions.--For purposes of this section--
            ``(1) Worldwide affiliated group.--The term `worldwide 
        affiliated group' means an affiliated group as defined in 
        section 1504(a), determined--
                    ``(A) by substituting `more than 50 percent' for 
                `at least 80 percent' each place it appears, and
                    ``(B) without regard to section 1504(b).
        A partnership or any other entity (other than a corporation) 
        shall be treated as a member of a worldwide 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 sentence).
            ``(2) Correspondent account.--The term `correspondent 
        account' means an account established to receive deposits from, 
        or make payments on behalf of, a financial institution or 
        handle other financial transactions related to such 
        institution.
            ``(3) Payable-through account.--The term `payable-through 
        account' means an account, including a transaction account (as 
        defined in section 19(b)(1)(C) of the Federal Reserve Act), 
        opened at a depository institution by another financial 
        institution by means of which the financial institution permits 
        its customers to engage, either directly or through a 
        subaccount, in banking activities usually in connection with 
        the business of banking.
            ``(4) Account.--The term `account' means a formal banking 
        or business relationship established to provide regular 
        services, dealings, and other financial transactions and 
        includes a demand deposit, savings deposit, or other 
        transaction or asset account and a credit account or other 
        extension of credit.
            ``(5) Financial institution.--The term `financial 
        institution' shall have the meaning given such term under 
        section 5312(a)(2) of title 31, United States Code.
            ``(6) Iranian person.--The term `Iranian person' means--
                    ``(A) any person in Iran,
                    ``(B) any citizen or resident of Iran,
                    ``(C) any foreign partnership or foreign 
                corporation which is organized or operated in Iran (or 
                is a member of such a person's worldwide affiliated 
                group),
                    ``(D) any foreign trust if--
                            ``(i) a court within Iran is able to 
                        exercise primary supervision over the 
                        administration of the trust, and
                            ``(ii) one or more persons described in 
                        subparagraph (A) or (B) have the authority to 
                        control all substantial decisions of the trust, 
                        and
                    ``(E) any foreign estate a beneficiary of which is 
                a person described in subparagraph (A).
    ``(e) Special Rules.--
            ``(1) Certain licensed transactions.--This section shall 
        not apply in the case of a transaction authorized under part 
        535, 560, or 561 of title 31, Code of Federal Regulations, as 
        in effect on June 1, 2016.
            ``(2) Humanitarian assistance.--This section shall not 
        apply in the case of any transaction permitted--
                    ``(A) under section 413 of the Iran Threat 
                Reduction and Syria Human Rights Act of 2012, or
                    ``(B) under a license issued under the 
                International Emergency Economic Powers Act (50 U.S.C. 
                1701 et seq.) if--
                            ``(i) such transaction relates solely to--
                                    ``(I) the provision of agricultural 
                                commodities, food, medicine, or medical 
                                devices to Iran, or
                                    ``(II) the provision of 
                                humanitarian assistance to the people 
                                of Iran, and
                            ``(ii) the President submits a copy of the 
                        license to the Committee on Ways and Means of 
                        the House of Representatives and the Committee 
                        on Finance of the Senate, the Committee on 
                        Financial Services of the House of 
                        Representatives and the Committee on Banking, 
                        Housing, and Urban Affairs of the Senate, and 
                        the Committee on Foreign Affairs of the House 
                        of Representatives and the Committee on Foreign 
                        Relations of the Senate.
            ``(3) Intelligence activities.--This section shall not 
        apply in the case of intelligence activities subject to 
        reporting requirements under title V of the National Security 
        Act of 1947 (50 U.S.C. 3091 et seq.).
            ``(4) Joint and several liability.--If more than 1 person 
        is liable under subsection (a) or (b) with respect to a dollar 
        clearing or transferring transaction, all such persons shall be 
        jointly and severally liable under such subsection with respect 
        to such transaction.''.
    (b) Clerical Amendment.--The table of chapters for subtitle D of 
such Code is amended by adding at the end the following new item:

      ``Chapter 50A. Clearing Transactions With Respect to Iran''.

    (c) Effective Date.--The amendments made by this section shall 
apply to transactions after June 21, 2016.