I 

116TH CONGRESS 

2D SESSION H. R. 6992 

To amend the Internal Revenue Code of 1986 to encourage domestic 

insourcing and discourage foreign outsourcing. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 22, 2020 

Mr. PASCRELL (for himself, Mr. DANNY K. DAVIS of Illinois, Ms. SA ́NCHEZ, 

Ms. DELBENE, Mr. SWALWELL of California, Ms. NORTON, Ms. 

BROWNLEY of California, Mrs. WATSON COLEMAN, Ms. BARRAGA ́N, Ms. 

LEE of California, and Mr. COHEN) 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 encourage 

domestic insourcing and discourage foreign outsourcing. 

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 ‘‘Bring Jobs Home 

5 Act’’. 

6 SEC. 2. CREDIT FOR INSOURCING EXPENSES. 

7 (a) IN GENERAL.—Subpart D of part IV of sub8 chapter A of chapter 1 of the Internal Revenue Code of 


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1 1986 is amended by adding at the end the following new 

2 section: 

3 ‘‘SEC. 45U. CREDIT FOR INSOURCING EXPENSES. 

4 ‘‘(a) IN GENERAL.—For purposes of section 38, the 

5 insourcing expenses credit for any taxable year is an 

6 amount equal to 20 percent of the eligible insourcing ex7 penses of the taxpayer which are taken into account in 

8 such taxable year under subsection (d). 

9 ‘‘(b) ELIGIBLE INSOURCING EXPENSES.—For pur10 poses of this section— 

11 ‘‘(1) IN GENERAL.—The term ‘eligible 

12 insourcing expenses’ means— 

13 ‘‘(A) eligible expenses paid or incurred by 

14 the taxpayer in connection with the elimination 

15 of any business unit of the taxpayer (or of any 

16 member of any expanded affiliated group in 

17 which the taxpayer is also a member) located 

18 outside the United States, and 

19 ‘‘(B) eligible expenses paid or incurred by 

20 the taxpayer in connection with the establish21 ment of any business unit of the taxpayer (or 

22 of any member of any expanded affiliated group 

23 in which the taxpayer is also a member) located 

24 within the United States, 


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1 if such establishment constitutes the relocation of 

2 business unit so eliminated. For purposes of the pre3 ceding sentence, a relocation shall not be treated as 

4 failing to occur merely because such elimination oc5 curs in a different taxable year than such establish6 ment. 

7 ‘‘(2) ELIGIBLE EXPENSES.—The term ‘eligible 

8 expenses’ means— 

9 ‘‘(A) any amount for which a deduction is 

10 allowed to the taxpayer under section 162, and 

11 ‘‘(B) permit and license fees, lease broker12 age fees, equipment installation costs, and, to 

13 the extent provided by the Secretary, other 

14 similar expenses. 

15 Such term does not include any compensation which 

16 is paid or incurred in connection with severance 

17 from employment and, to the extent provided by the 

18 Secretary, any similar amount. 

19 ‘‘(3) BUSINESS UNIT.—The term ‘business unit’ 

20 means— 

21 ‘‘(A) any trade or business, and 

22 ‘‘(B) any line of business, or functional 

23 unit, which is part of any trade or business. 

24 ‘‘(4) EXPANDED AFFILIATED GROUP.—The 

25 term ‘expanded affiliated group’ means an affiliated 


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1 group as defined in section 1504(a), determined 

2 without regard to section 1504(b)(3) and by sub3 stituting ‘more than 50 percent’ for ‘at least 80 per4 cent’ each place it appears in section 1504(a). A 

5 partnership or any other entity (other than a cor6 poration) shall be treated as a member of an ex7 panded affiliated group if such entity is controlled 

8 (within the meaning of section 954(d)(3)) by mem9 bers of such group (including any entity treated as 

10 a member of such group by reason of this para11 graph). 

12 ‘‘(5) EXPENSES MUST BE PURSUANT TO

13 INSOURCING PLAN.—Amounts shall be taken into ac14 count under paragraph (1) only to the extent that 

15 such amounts are paid or incurred pursuant to a 

16 written plan approved the board of directors or au17 thorized officers to carry out the relocation described 

18 in paragraph (1). 

19 ‘‘(6) OPERATING EXPENSES NOT TAKEN INTO

20 ACCOUNT.—Any amount paid or incurred in connec21 tion with the ongoing operation of a business unit 

22 shall not be treated as an amount paid or incurred 

23 in connection with the establishment or elimination 

24 of such business unit. 


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1 ‘‘(c) INCREASED DOMESTIC EMPLOYMENT REQUIRE2 MENT.—No credit shall be allowed under this section un3 less the number of full-time equivalent employees of the 

4 taxpayer for the taxable year for which the credit is 

5 claimed exceeds the number of full-time equivalent em6 ployees of the taxpayer for the last taxable year ending 

7 before the first taxable year in which such eligible 

8 insourcing expenses were paid or incurred. For purposes 

9 of this subsection, full-time equivalent employees has the 

10 meaning given such term under section 45R(d) (and the 

11 applicable rules of section 45R(e)), determined by only 

12 taking into account wages (as otherwise defined in section 

13 45R(e)) paid with respect to services performed within the 

14 United States. All employers treated as a single employer 

15 under subsection (b), (c), (m), or (o) of section 414 shall 

16 be treated as a single employer for purposes of this sub17 section. 

18 ‘‘(d) CREDIT ALLOWED UPON COMPLETION OF

19 INSOURCING PLAN.— 

20 ‘‘(1) IN GENERAL.—Except as provided in para21 graph (2), eligible insourcing expenses shall be taken 

22 into account under subsection (a) in the taxable year 

23 during which the plan described in subsection (b)(5) 

24 has been completed and all eligible insourcing exVerDate Sep 11 2014 18:22 Jun 16, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H6992.IH H6992

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1 penses pursuant to such plan have been paid or in2 curred. 

3 ‘‘(2) ELECTION TO APPLY EMPLOYMENT TEST

4 AND CLAIM CREDIT IN FIRST FULL TAXABLE YEAR

5 AFTER COMPLETION OF PLAN.—If the taxpayer 

6 elects the application of this paragraph, eligible 

7 insourcing expenses shall be taken into account 

8 under subsection (a) in the first taxable year after 

9 the taxable year described in paragraph (1). 

10 ‘‘(e) POSSESSIONS TREATED AS PART OF THE

11 UNITED STATES.—For purposes of this section, the term 

12 ‘United States’ shall be treated as including each posses13 sion of the United States (including the Commonwealth 

14 of Puerto Rico and the Commonwealth of the Northern 

15 Mariana Islands). 

16 ‘‘(f) REGULATIONS.—The Secretary shall prescribe 

17 such regulations or other guidance as may be necessary 

18 or appropriate to carry out the purposes of this section.’’. 

19 (b) CREDIT TO BE PART OF GENERAL BUSINESS

20 CREDIT.—Section 38(b) of such Code is amended by strik21 ing ‘‘plus’’ at the end of paragraph (32), by striking the 

22 period at the end of paragraph (33) and inserting ‘‘, plus’’, 

23 and by adding at the end the following new paragraph: 

24 ‘‘(34) the insourcing expenses credit determined 

25 under section 45U(a).’’. 


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1 (c) CONFORMING AMENDMENTS.— 

2 (1) Section 280C of such Code is amended by 

3 adding at the end the following new subsection: 

4 ‘‘(i) CREDIT FOR INSOURCING EXPENSES.—No de5 duction shall be allowed for that portion of the expenses 

6 otherwise allowable as a deduction taken into account in 

7 determining the credit under section 45U for the taxable 

8 year which is equal to the amount of the credit determined 

9 for such taxable year under section 45U(a).’’. 

10 (2) The table of sections for subpart D of part 

11 IV of subchapter A of chapter 1 of such Code is 

12 amended by adding at the end the following new 

13 item: 

‘‘Sec. 45U. Credit for insourcing expenses.’’. 

14 (d) EFFECTIVE DATE.—The amendments made by 

15 this section shall apply to amounts paid or incurred after 

16 the date of the enactment of this Act. 

17 (e) APPLICATION TO UNITED STATES POSSES18 SIONS.— 

19 (1) PAYMENTS TO POSSESSIONS.— 

20 (A) MIRROR CODE POSSESSIONS.—The 

21 Secretary of the Treasury shall make periodic 

22 payments to the United States Virgin Islands, 

23 Guam, and the Commonwealth of the Northern 

24 Mariana Islands in an amount equal to the loss 

25 to that possession by reason of section 45U of 


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1 the Internal Revenue Code of 1986. Such 

2 amount shall be determined by the Secretary of 

3 the Treasury based on information provided by 

4 the government of the respective possession. 

5 (B) OTHER POSSESSIONS.—The Secretary 

6 of the Treasury shall make annual payments to 

7 the Commonwealth of Puerto Rico and Amer8 ican Samoa in an amount estimated by the Sec9 retary of the Treasury as being equal to the ag10 gregate benefits that would have been provided 

11 to residents of each such possession by reason 

12 of section 45U of such Code if a mirror code 

13 tax system had been in effect in such posses14 sion. The preceding sentence shall not apply 

15 with respect to any possession of the United 

16 States unless such possession has a plan, which 

17 has been approved by the Secretary of the 

18 Treasury, under which such possession will 

19 promptly distribute such payment to the resi20 dents of such possession. 

21 (2) COORDINATION WITH CREDIT ALLOWED

22 AGAINST UNITED STATES INCOME TAXES.—No cred23 it shall be allowed against United States income 

24 taxes under section 45U of such Code to any per25 son— 


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1 (A) to whom a credit is allowed against 

2 taxes imposed by the possession by reason of 

3 such section, or 

4 (B) who is eligible for a payment under a 

5 plan described in paragraph (1)(B). 

6 (3) TREATMENT OF PAYMENTS.—For purposes 

7 of section 1324(b)(2) of title 31, United States 

8 Code, the payments under this section shall be treat9 ed in the same manner as a refund due from sec10 tions referred to in such section 1324(b)(2). 

11 SEC. 3. DENIAL OF DEDUCTION FOR OUTSOURCING EX12 PENSES. 

13 (a) IN GENERAL.—Part IX of subchapter B of chap14 ter 1 of the Internal Revenue Code of 1986 is amended 

15 by adding at the end the following new section: 

16 ‘‘SEC. 280I. OUTSOURCING EXPENSES. 

17 ‘‘(a) IN GENERAL.—No deduction otherwise allow18 able under this chapter shall be allowed for any specified 

19 outsourcing expense. 

20 ‘‘(b) SPECIFIED OUTSOURCING EXPENSE.—For pur21 poses of this section— 

22 ‘‘(1) IN GENERAL.—The term ‘specified out23 sourcing expense’ means— 

24 ‘‘(A) any eligible expense paid or incurred 

25 by the taxpayer in connection with the elimiVerDate Sep 11 2014 18:22 Jun 16, 2020 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H6992.IH H6992

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1 nation of any business unit of the taxpayer (or 

2 of any member of any expanded affiliated group 

3 in which the taxpayer is also a member) located 

4 within the United States, and 

5 ‘‘(B) any eligible expense paid or incurred 

6 by the taxpayer in connection with the estab7 lishment of any business unit of the taxpayer 

8 (or of any member of any expanded affiliated 

9 group in which the taxpayer is also a member) 

10 located outside the United States, 

11 if such establishment constitutes the relocation of 

12 business unit so eliminated. For purposes of the pre13 ceding sentence, a relocation shall not be treated as 

14 failing to occur merely because such elimination oc15 curs in a different taxable year than such establish16 ment. 

17 ‘‘(2) APPLICATION OF CERTAIN DEFINITIONS

18 AND RULES.— 

19 ‘‘(A) DEFINITIONS.—For purposes of this 

20 section, the terms ‘eligible expenses’, ‘business 

21 unit’, and ‘expanded affiliated group’ shall have 

22 the respective meanings given such terms by 

23 section 45U(b). 

24 ‘‘(B) OPERATING EXPENSES NOT TAKEN

25 INTO ACCOUNT.—A rule similar to the rule of 


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1 section 45U(b)(6) shall apply for purposes of 

2 this section. 

3 ‘‘(c) SPECIAL RULES.— 

4 ‘‘(1) APPLICATION TO DEDUCTIONS FOR DE5 PRECIATION AND AMORTIZATION.—In the case of 

6 any portion of a specified outsourcing expense which 

7 is not deductible in the taxable year in which paid 

8 or incurred, such portion shall neither be chargeable 

9 to capital account nor amortizable. 

10 ‘‘(2) POSSESSIONS TREATED AS PART OF THE

11 UNITED STATES.—For purposes of this section, the 

12 term ‘United States’ shall be treated as including 

13 each possession of the United States (including the 

14 Commonwealth of Puerto Rico and the Common15 wealth of the Northern Mariana Islands). 

16 ‘‘(d) REGULATIONS.—The Secretary shall prescribe 

17 such regulations or other guidance as may be necessary 

18 or appropriate to carry out the purposes of this section, 

19 including regulations which provide (or create a rebuttable 

20 presumption) that certain establishments of business units 

21 outside the United States will be treated as relocations 

22 (based on timing or such other factors as the Secretary 

23 may provide) of business units eliminated within the 

24 United States.’’. 


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1 (b) LIMITATION ON SUBPART F INCOME OF CON2 TROLLED FOREIGN CORPORATIONS DETERMINED WITH3 OUT REGARD TO SPECIFIED OUTSOURCING EXPENSES.— 

4 Section 952(c) of such Code is amended by adding at the 

5 end the following new paragraph: 

6 ‘‘(4) EARNINGS AND PROFITS DETERMINED

7 WITHOUT REGARD TO SPECIFIED OUTSOURCING EX8 PENSES.—For purposes of this subsection, earnings 

9 and profits of any controlled foreign corporation 

10 shall be determined without regard to any specified 

11 outsourcing expense (as defined in section 

12 280I(b)).’’. 

13 (c) CLERICAL AMENDMENT.—The table of sections 

14 for part IX of subchapter B of chapter 1 of such Code 

15 is amended by adding at the end the following new item: 

‘‘Sec. 280I. Outsourcing expenses.’’. 

16 (d) EFFECTIVE DATE.—The amendments made by 

17 this section shall apply to amounts paid or incurred after 

18 the date of the enactment of this Act. 

19 SEC. 4. REINSTATEMENT OF DEDUCTION FOR MOVING EX20 PENSES. 

21 (a) IN GENERAL.—Section 217 of the Internal Rev22 enue Code of 1986 is amended by striking subsection (k). 


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

2 this section shall apply to taxable years ending after the 

3 date of the enactment of this Act. 

Æ 


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