I 

113TH CONGRESS 

1ST SESSION H. R. 3793 

To restore full military retirement benefits by closing corporate tax loopholes. 

IN THE HOUSE OF REPRESENTATIVES 

DECEMBER 19, 2013 

Mr. MAFFEI (for himself, Mr. CASTRO of Texas, Ms. SHEA-PORTER, Mr. 

SEAN PATRICK MALONEY of New York, Mr. RYAN of Ohio, Mr. COURTNEY, Mr. LOEBSACK, Mr. DEFAZIO, Ms. PINGREE of Maine, Mr. HECK

of Washington, Mr. DOGGETT, Mr. LANGEVIN, Mr. BARBER, Ms. 

GABBARD, Mr. BUTTERFIELD, Ms. WILSON of Florida, Mr. MICHAUD, 

Ms. KUSTER, Mr. VELA, Mr. WALZ, Ms. WASSERMAN SCHULTZ, Mr. 

KILDEE, Ms. HANABUSA, Mr. PETERS of Michigan, Ms. BORDALLO, Mr. 

O’ROURKE, Ms. MICHELLE LUJAN GRISHAM of New Mexico, Mr. GRAYSON, Mr. GARAMENDI, Mr. PERLMUTTER, Mrs. BUSTOS, Ms. CASTOR of 

Florida, Ms. SCHWARTZ, Ms. EDWARDS, Mr. TONKO, Mr. BRALEY of 

Iowa, and Mr. LARSON of Connecticut) introduced the following bill; 

which was referred to the Committee on Ways and Means, and in addition to the Committee on Armed Services, for a period to be subsequently 

determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To restore full military retirement benefits by closing 

corporate tax loopholes. 

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


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1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as the ‘‘Military Retirement 

3 Restoration Act’’. 

4 SEC. 2. REPEAL OF REDUCTIONS MADE BY BIPARTISAN 

5 BUDGET ACT OF 2013. 

6 Section 403 of the Bipartisan Budget Act of 2013 

7 is repealed as of the date of the enactment of such Act. 

8 SEC. 3. TREATMENT OF FOREIGN CORPORATIONS MAN9 AGED AND CONTROLLED IN THE UNITED 

10 STATES AS DOMESTIC CORPORATIONS. 

11 (a) IN GENERAL.—Section 7701 of the Internal Rev12 enue Code of 1986 is amended by redesignating subsection 

13 (p) as subsection (q) and by inserting after subsection (o) 

14 the following new subsection: 

15 ‘‘(p) CERTAIN CORPORATIONS MANAGED AND CON16 TROLLED IN THE UNITED STATES TREATED AS DOMES17 TIC FOR INCOME TAX.— 

18 ‘‘(1) IN GENERAL.—Notwithstanding subsection 

19 (a)(4), in the case of a corporation described in 

20 paragraph (2) if— 

21 ‘‘(A) the corporation would not otherwise 

22 be treated as a domestic corporation for pur23 poses of this title, but 

24 ‘‘(B) the management and control of the 

25 corporation occurs, directly or indirectly, pri26 marily within the United States, 


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1 then, solely for purposes of chapter 1 (and any other 

2 provision of this title relating to chapter 1), the cor3 poration shall be treated as a domestic corporation. 

4 ‘‘(2) CORPORATION DESCRIBED.— 

5 ‘‘(A) IN GENERAL.—A corporation is de6 scribed in this paragraph if— 

7 ‘‘(i) the stock of such corporation is 

8 regularly traded on an established securi9 ties market, or 

10 ‘‘(ii) the aggregate gross assets of 

11 such corporation (or any predecessor there12 of), including assets under management 

13 for investors, whether held directly or indi14 rectly, at any time during the taxable year 

15 or any preceding taxable year is 

16 $50,000,000 or more. 

17 ‘‘(B) GENERAL EXCEPTION.—A corpora18 tion shall not be treated as described in this 

19 paragraph if— 

20 ‘‘(i) such corporation was treated as a 

21 corporation described in this paragraph in 

22 a preceding taxable year, 

23 ‘‘(ii) such corporation— 

24 ‘‘(I) is not regularly traded on an 

25 established securities market, and 


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1 ‘‘(II) has, and is reasonably ex2 pected to continue to have, aggregate 

3 gross assets (including assets under 

4 management for investors, whether 

5 held directly or indirectly) of less than 

6 $50,000,000, and 

7 ‘‘(iii) the Secretary grants a waiver to 

8 such corporation under this subparagraph. 

9 ‘‘(3) MANAGEMENT AND CONTROL.— 

10 ‘‘(A) IN GENERAL.—The Secretary shall 

11 prescribe regulations for purposes of deter12 mining cases in which the management and 

13 control of a corporation is to be treated as oc14 curring primarily within the United States. 

15 ‘‘(B) EXECUTIVE OFFICERS AND SENIOR

16 MANAGEMENT.—Such regulations shall provide 

17 that— 

18 ‘‘(i) the management and control of a 

19 corporation shall be treated as occurring 

20 primarily within the United States if sub21 stantially all of the executive officers and 

22 senior management of the corporation who 

23 exercise day-to-day responsibility for mak24 ing decisions involving strategic, financial, 

25 and operational policies of the corporation 


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1 are located primarily within the United 

2 States, and 

3 ‘‘(ii) individuals who are not executive 

4 officers and senior management of the cor5 poration (including individuals who are of6 ficers or employees of other corporations in 

7 the same chain of corporations as the cor8 poration) shall be treated as executive offi9 cers and senior management if such indi10 viduals exercise the day-to-day responsibil11 ities of the corporation described in clause 

12 (i). 

13 ‘‘(C) CORPORATIONS PRIMARILY HOLDING

14 INVESTMENT ASSETS.—Such regulations shall 

15 also provide that the management and control 

16 of a corporation shall be treated as occurring 

17 primarily within the United States if— 

18 ‘‘(i) the assets of such corporation (di19 rectly or indirectly) consist primarily of as20 sets being managed on behalf of investors, 

21 and 

22 ‘‘(ii) decisions about how to invest the 

23 assets are made in the United States.’’. 

24 (b) EFFECTIVE DATE.—The amendments made by 

25 this section shall apply to taxable years beginning on or 


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1 after the date which is 2 years after the date of the enact2 ment of this Act, whether or not regulations are issued 

3 under section 7701(p)(3) of the Internal Revenue Code 

4 of 1986, as added by this section. 

Æ 


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