I 

111TH CONGRESS 

1ST SESSION H. R. 1572 

To amend the Internal Revenue Code of 1986 to impose a 90 percent 

tax on bonuses paid by business that receive TARP assistance. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 17, 2009 

Mr. THOMPSON of California 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 90 percent tax on bonuses paid by business that receive 

TARP assistance. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Taxpayer Protection 

5 Act’’. 

6 SEC. 2. 90 PERCENT TAX ON BONUSES PAID BY BUSINESSES 

7 THAT RECEIVE TARP ASSISTANCE. 

8 (a) IN GENERAL.—Section 1 of the Internal Revenue 

9 Code of 1986 (relating to tax imposed on individuals) is 


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1 amended by adding at the end the following new sub2 section: 

3 ‘‘(j) 90 PERCENT TAX ON BONUSES PAID BY BUSI4 NESSES THAT RECEIVE TARP ASSISTANCE.— 

5 ‘‘(1) IN GENERAL.—In the case of any indi6 vidual who receives a bonus during the taxable year 

7 from a TARP business, the tax imposed by this sec8 tion shall be equal to— 

9 ‘‘(A) the tax which would be imposed by 

10 this section if the taxable income of such indi11 vidual for the taxable year were reduced by 

12 such bonus, plus 

13 ‘‘(B) the amount equal to 90 percent of 

14 such bonus. 

15 ‘‘(2) TARP BUSINESS.—For purposes of this 

16 subsection— 

17 ‘‘(A) IN GENERAL.—The term ‘TARP 

18 business’ means any person (or any predecessor 

19 of such person) who received assistance under 

20 title I of division A the Emergency Economic 

21 Stabilization Act of 2008 during the taxable 

22 year or any prior taxable year. 

23 ‘‘(B) CONTROLLED GROUPS.— 

24 ‘‘(i) IN GENERAL.—For purposes of 

25 subparagraph (A), all persons treated as a 


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1 single employer under subsection (a) or (b) 

2 of section 52 or under subsection (m) or 

3 (o) of section 414 shall be treated as one 

4 person. 

5 ‘‘(ii) INCLUSION OF FOREIGN COR6 PORATIONS.—For purposes of clause (i), in 

7 applying subsections (a) and (b) of section 

8 52 to this section, section 1563 shall be 

9 applied without regard to subsection 

10 (b)(2)(C) thereof. 

11 ‘‘(3) BONUS.—For purposes of this subsection, 

12 a bonus does not include any amount payable to an 

13 individual for services performed by such individual 

14 at a regular hourly, daily, weekly, monthly, or simi15 lar periodic rate, and does not include payments to 

16 an employee as commissions, welfare and fringe ben17 efits, or expense reimbursements. 

18 ‘‘(4) APPLICATION.—Paragraph (1) shall not 

19 apply to any bonus paid by a TARP business after 

20 the date on which such business has repaid to the 

21 United States all of the assistance such business re22 ceived under title I of division A the Emergency 

23 Economic Stabilization Act of 2008.’’. 


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1 (b) EFFECTIVE DATE.—The amendment made by 

2 this section shall apply to taxable years beginning after 

3 December 31, 2008. 

Æ 


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