I 

116TH CONGRESS 

1ST SESSION H. R. 410 

To amend the Internal Revenue Code of 1986 to provide reimbursement 

for possessions of the United States with respect to the earned income 

tax credit and the child tax credit. 

IN THE HOUSE OF REPRESENTATIVES 

JANUARY 9, 2019 

Ms. PLASKETT 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 provide 

reimbursement for possessions of the United States with 

respect to the earned income tax credit and the child 

tax credit. 

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 ‘‘Territorial Economic 

5 Growth and Recovery Act of 2019’’. 


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1 SEC. 2. REIMBURSEMENT OF POSSESSIONS FOR COST OF 

2 EARNED INCOME TAX CREDIT. 

3 (a) EARNED INCOME CREDIT.—Section 32 of the In4 ternal Revenue Code of 1986 is amended by adding at the 

5 end the following new subsection: 

6 ‘‘(n) TREATMENT OF POSSESSIONS.— 

7 ‘‘(1) PAYMENTS TO POSSESSIONS.— 

8 ‘‘(A) MIRROR CODE POSSESSION.—The 

9 Secretary of the Treasury shall periodically (but 

10 not less frequently than annually) pay to each 

11 possession of the United States with a mirror 

12 code tax system amounts equal to the loss to 

13 that possession by reason of the application of 

14 this section (determined without regard to para15 graph (2)) with respect to taxable years begin16 ning after December 31, 2018. Such amounts 

17 shall be determined by the Secretary of the 

18 Treasury based on information provided by the 

19 government of the respective possession. 

20 ‘‘(B) OTHER POSSESSIONS.—The Sec21 retary of the Treasury shall periodically (but no 

22 less frequently than annually) pay to each pos23 session of the United States which does not 

24 have a mirror code tax system amounts esti25 mated by the Secretary of the Treasury as 

26 being equal to the aggregate benefits that would 


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1 have been provided to residents of such posses2 sion by reason of the application of this section 

3 for taxable years beginning after December 31, 

4 2018, if a mirror code tax system had been in 

5 effect in such possession. The preceding sen6 tence shall not apply with respect to any posses7 sion of the United States unless such possession 

8 has a plan, which has been approved by the 

9 Secretary of the Treasury, under which such 

10 possession will promptly distribute such pay11 ments to the residents of such possession. 

12 ‘‘(2) COORDINATION WITH CREDIT ALLOWED

13 AGAINST UNITED STATES INCOME TAXES.—No cred14 it shall be allowed under this section for any taxable 

15 year to any person— 

16 ‘‘(A) to whom a credit is allowed against 

17 taxes imposed by the possession by reason of 

18 this section (determined without regard to this 

19 paragraph) for such taxable year, or 

20 ‘‘(B) who is eligible for a payment under 

21 a plan described in paragraph (1)(B) with re22 spect to such taxable year. 

23 ‘‘(3) DEFINITIONS AND SPECIAL RULES.— 

24 ‘‘(A) POSSESSION OF THE UNITED

25 STATES.—For purposes of this subsection, the 


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•HR 410 IH

1 term ‘possession of the United States’ shall in2 clude such possessions as are specified in sec3 tion 937(a)(1) of the Internal Revenue Code of 

4 1986. 

5 ‘‘(B) MIRROR CODE TAX SYSTEM.—For 

6 purposes of this subsection, the term ‘mirror 

7 code tax system’ means, with respect to any 

8 possession of the United States, the income tax 

9 system of such possession if the income tax li10 ability of the residents of such possession under 

11 such system is determined by reference to the 

12 income tax laws of the United States as if such 

13 possession were the United States, and such 

14 system includes a tax credit substantially iden15 tical to the credit allowed under this section. 

16 ‘‘(C) TREATMENT OF PAYMENTS.—For 

17 purposes of section 1324(b)(2) of title 31, 

18 United States Code, or any similar rule of law, 

19 any payment made under this subsection shall 

20 be treated in the same manner as a refund due 

21 from the credit allowed under this section.’’. 

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

23 this section shall apply with respect to taxable years begin24 ning after December 31, 2018. 


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1 SEC. 3. REIMBURSEMENT OF POSSESSIONS FOR COST OF 

2 CHILD TAX CREDIT. 

3 (a) CHILD TAX CREDIT.—Section 24 of the Internal 

4 Revenue Code of 1986 is amended by adding at the end 

5 the following new subsection: 

6 ‘‘(i) TREATMENT OF POSSESSIONS.— 

7 ‘‘(1) PAYMENTS TO POSSESSIONS.— 

8 ‘‘(A) MIRROR CODE POSSESSION.—The 

9 Secretary of the Treasury shall periodically (but 

10 not less frequently than annually) pay to each 

11 possession of the United States with a mirror 

12 code tax system amounts equal to the loss to 

13 that possession by reason of the application of 

14 this section (determined without regard to para15 graph (2)) with respect to taxable years begin16 ning after December 31, 2018. Such amounts 

17 shall be determined by the Secretary of the 

18 Treasury based on information provided by the 

19 government of the respective possession. 

20 ‘‘(B) OTHER POSSESSIONS.—The Sec21 retary of the Treasury shall periodically (but no 

22 less frequently than annually) pay to each pos23 session of the United States which does not 

24 have a mirror code tax system amounts esti25 mated by the Secretary of the Treasury as 

26 being equal to the aggregate benefits that would 


pbinns on DSK79D2C42PROD with BILLS
6 

•HR 410 IH

1 have been provided to residents of such posses2 sion by reason of the application of this section 

3 for taxable years beginning after December 31, 

4 2018, if a mirror code tax system had been in 

5 effect in such possession. The preceding sen6 tence shall not apply with respect to any posses7 sion of the United States unless such possession 

8 has a plan, which has been approved by the 

9 Secretary of the Treasury, under which such 

10 possession will promptly distribute such pay11 ments to the residents of such possession. 

12 ‘‘(2) COORDINATION WITH CREDIT ALLOWED

13 AGAINST UNITED STATES INCOME TAXES.—No cred14 it shall be allowed under this section for any taxable 

15 year to any person— 

16 ‘‘(A) to whom a credit is allowed against 

17 taxes imposed by the possession by reason of 

18 this section (determined without regard to this 

19 paragraph) for such taxable year, or 

20 ‘‘(B) who is eligible for a payment under 

21 a plan described in paragraph (1)(B) with re22 spect to such taxable year. 

23 ‘‘(3) DEFINITIONS AND SPECIAL RULES.— 

24 ‘‘(A) POSSESSION OF THE UNITED

25 STATES.—For purposes of this subsection, the 


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7 

•HR 410 IH

1 term ‘possession of the United States’ shall in2 clude such possessions as are specified in sec3 tion 937(a)(1) of the Internal Revenue Code of 

4 1986. 

5 ‘‘(B) MIRROR CODE TAX SYSTEM.—For 

6 purposes of this subsection, the term ‘mirror 

7 code tax system’ means, with respect to any 

8 possession of the United States, the income tax 

9 system of such possession if the income tax li10 ability of the residents of such possession under 

11 such system is determined by reference to the 

12 income tax laws of the United States as if such 

13 possession were the United States, and such 

14 system includes a tax credit substantially iden15 tical to the credit allowed under this section. 

16 ‘‘(C) TREATMENT OF PAYMENTS.—For 

17 purposes of section 1324(b)(2) of title 31, 

18 United States Code, or any similar rule of law, 

19 any payment made under this subsection shall 

20 be treated in the same manner as a refund due 

21 from the credit allowed under this section.’’. 

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

23 this section shall apply with respect to taxable years begin24 ning after December 31, 2018. 

Æ 


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