I 

117TH CONGRESS 

1ST SESSION H. R. 2745 

To provide incentives for businesses to keep jobs in America, and for other 

purposes. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 21, 2021 

Mr. POCAN (for himself, Mr. GARCI ́A of Illinois, Mr. KHANNA, Mr. LYNCH, 

and Ms. NORTON) introduced the following bill; which was referred to the 

Committee on Ways and Means, and in addition to the Committees on 

Education and Labor, Oversight and Reform, and 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 provide incentives for businesses to keep jobs in America, 

and for other purposes. 

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 ‘‘End Outsourcing Act’’. 

5 SEC. 2. OUTSOURCING STATEMENT IN WORKER ADJUST6 MENT AND RETRAINING NOTICE. 

7 (a) OUTSOURCING STATEMENT.—Section 3 of the 

8 Worker Adjustment and Retraining Notification Act (29 


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1 U.S.C. 2102) is amended by adding at the end the fol2 lowing: 

3 ‘‘(e) OUTSOURCING STATEMENT.— 

4 ‘‘(1) IN GENERAL.—For purposes of subsection 

5 (a), the employer shall include an outsourcing state6 ment in the notice described in that subsection. The 

7 outsourcing statement shall specify whether part or 

8 all of the positions held by affected employees cov9 ered by subsection (a) will be moved to a country 

10 outside the United States, regardless of whether the 

11 positions are moved within the business enterprise 

12 involved or to another business enterprise. The em13 ployer shall make the determination of whether the 

14 positions are being so moved in accordance with reg15 ulations issued by the Secretary. The employer shall 

16 serve the notice as required under subsection (a) and 

17 submit the notice to the Secretary of Labor. 

18 ‘‘(2) LIST.—Not less often than annually, the 

19 Secretary shall publish and make available on the 

20 website of the Department of Labor, a list including 

21 each employer who— 

22 ‘‘(A) has included an outsourcing state23 ment in a notice under paragraph (1); or 

24 ‘‘(B) has incurred liability under section 5, 

25 in part or in whole, because the employer orVerDate Sep 11 2014 02:56 Jun 05, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H2745.IH H2745

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1 dered a plant closing or mass layoff without 

2 having served a notice that is required, under 

3 this section, to include an outsourcing state4 ment.’’. 

5 (b) IMPLEMENTATION REPORT.—The Worker Ad6 justment and Retraining Notification Act is amended by 

7 inserting after section 10 (29 U.S.C. 2109) the following: 

8 ‘‘SEC. 10A. IMPLEMENTATION STUDY. 

9 ‘‘(a) STUDY.—The Comptroller General of the United 

10 States shall conduct a study of the implementation of sec11 tion 3(e) of the Worker Adjustment and Retraining Notifi12 cation Act (29 U.S.C. 2102(e)) by the Department of 

13 Labor. 

14 ‘‘(b) REPORT.—Not later than 3 years after the date 

15 of enactment of this section, the Comptroller General shall 

16 submit to the appropriate committees of Congress a report 

17 containing the results of the study.’’. 

18 SEC. 3. DENIAL OF DEDUCTION FOR OUTSOURCING EX19 PENSES. 

20 (a) IN GENERAL.—Part IX of subchapter B of chap21 ter 1 of the Internal Revenue Code of 1986 is amended 

22 by adding at the end the following new section: 


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1 ‘‘SEC. 280I. OUTSOURCING EXPENSES. 

2 ‘‘(a) IN GENERAL.—No deduction otherwise allow3 able under this chapter shall be allowed for any specified 

4 outsourcing expense. 

5 ‘‘(b) SPECIFIED OUTSOURCING EXPENSE.—For pur6 poses of this section— 

7 ‘‘(1) IN GENERAL.—The term ‘specified out8 sourcing expense’ means— 

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

10 by the taxpayer in connection with the elimi11 nation of any business unit of the taxpayer (or 

12 of any member of any expanded affiliated group 

13 in which the taxpayer is also a member) located 

14 within the United States, and 

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

16 by the taxpayer in connection with the estab17 lishment of any business unit of the taxpayer 

18 (or of any member of any expanded affiliated 

19 group in which the taxpayer is also a member) 

20 located outside the United States, 

21 if such establishment constitutes the relocation of 

22 the business unit so eliminated. For purposes of the 

23 preceding sentence, a relocation shall not be treated 

24 as failing to occur merely because such elimination 

25 occurs in a different taxable year than such estab26 lishment. 


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

2 expenses’ means— 

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

4 allowed to the taxpayer under section 162, and 

5 ‘‘(B) permit and license fees, lease broker6 age fees, equipment installation costs, and, to 

7 the extent provided by the Secretary, other 

8 similar expenses. 

9 Such term does not include any compensation which 

10 is paid or incurred in connection with severance 

11 from employment and, to the extent provided by the 

12 Secretary, any similar amount. 

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

14 means— 

15 ‘‘(A) any trade or business, and 

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

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

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

19 term ‘expanded affiliated group’ means an affiliated 

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

21 without regard to section 1504(b)(3) and by sub22 stituting ‘more than 50 percent’ for ‘at least 80 per23 cent’ each place it appears in section 1504(a). A 

24 partnership or any other entity (other than a cor25 poration) shall be treated as a member of an exVerDate Sep 11 2014 02:56 Jun 05, 2021 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H2745.IH H2745

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1 panded affiliated group if such entity is controlled 

2 (within the meaning of section 954(d)(3)) by mem3 bers of such group (including any entity treated as 

4 a member of such group by reason of this para5 graph). 

6 ‘‘(5) OPERATING EXPENSES NOT TAKEN INTO

7 ACCOUNT.—Any amount paid or incurred in connec8 tion with the ongoing operation of a business unit 

9 shall not be treated as an amount paid or incurred 

10 in connection with the establishment or elimination 

11 of such business unit. 

12 ‘‘(c) SPECIAL RULES.— 

13 ‘‘(1) APPLICATION TO DEDUCTIONS FOR DE14 PRECIATION AND AMORTIZATION.—In the case of 

15 any portion of a specified outsourcing expense which 

16 is not deductible in the taxable year in which paid 

17 or incurred, such portion shall neither be chargeable 

18 to capital account nor amortizable. 

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

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

21 term ‘United States’ shall be treated as including 

22 each possession of the United States (including the 

23 Commonwealth of Puerto Rico and the Common24 wealth of the Northern Mariana Islands). 


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

2 such regulations or other guidance as may be necessary 

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

4 including regulations which provide (or create a rebuttable 

5 presumption) that certain establishments of business units 

6 outside the United States will be treated as relocations 

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

8 may provide) of business units eliminated within the 

9 United States.’’. 

10 (b) LIMITATION ON SUBPART F INCOME OF CON11 TROLLED FOREIGN CORPORATIONS DETERMINED WITH12 OUT REGARD TO SPECIFIED OUTSOURCING EXPENSES.— 

13 Subsection (c) of section 952 of such Code is amended 

14 by adding at the end the following new paragraph: 

15 ‘‘(4) EARNINGS AND PROFITS DETERMINED

16 WITHOUT REGARD TO SPECIFIED OUTSOURCING EX17 PENSES.—For purposes of this subsection, earnings 

18 and profits of any controlled foreign corporation 

19 shall be determined without regard to any specified 

20 outsourcing expense (as defined in section 

21 280I(b)).’’. 

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

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

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

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


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

2 this section shall apply to amounts paid or incurred after 

3 the date of the enactment of this Act. 

4 SEC. 4. DENIAL OF CERTAIN DEDUCTIONS AND ACCOUNT5 ING METHODS FOR OUTSOURCING EMPLOY6 ERS. 

7 (a) IN GENERAL.—Part IX of subchapter B of chap8 ter 1 of the Internal Revenue Code of 1986, as amended 

9 by section 3, is amended by adding at the end the fol10 lowing new section: 

11 ‘‘SEC. 280J. LIMITATIONS FOR OUTSOURCING EMPLOYERS. 

12 ‘‘(a) IN GENERAL.—During the disallowance period, 

13 an applicable taxpayer— 

14 ‘‘(1) may not use the method provided in sec15 tion 472(b) in inventorying goods, 

16 ‘‘(2) may not use the lower of cost or market 

17 method of determining inventories for purposes of 

18 determining income, and 

19 ‘‘(3) shall not be allowed any deduction under 

20 section 163 for interest paid or accrued on indebted21 ness. 

22 ‘‘(b) APPLICABLE TAXPAYER.—For purposes of sub23 section (a), the term ‘applicable taxpayer’ means a tax24 payer which— 


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1 ‘‘(1) during the taxable year, has served written 

2 notice under subsection (a) of section 3 of the Work3 er Adjustment and Retraining Notification Act 

4 which includes an outsourcing statement described 

5 in subsection (e) of such section, and 

6 ‘‘(2) the cumulative employment loss (excluding 

7 any part-time employees) for positions at facilities 

8 owned by such taxpayer which will be moved to a 

9 country outside of the United States, as determined 

10 pursuant to any outsourcing statements served by 

11 such taxpayer during such taxable year, exceeds 50 

12 employees. 

13 ‘‘(c) DISALLOWANCE PERIOD.—For purposes of sub14 section (a), the disallowance period is the period of 3 tax15 able years after the taxable year in which the statements 

16 described in subsection (b)(2) are required to be served. 

17 ‘‘(d) EXPANDED AFFILIATED GROUP TREATED AS

18 SINGLE TAXPAYER.—For purposes of this section, the 

19 members of an expanded affiliated group (as defined in 

20 section 280I(b)(4)) shall be treated as a single taxpayer. 

21 ‘‘(e) REGULATIONS.—The Secretary shall prescribe 

22 such regulations or other guidance as may be necessary 

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

24 (b) CLERICAL AMENDMENT.—The table of sections 

25 for part IX of subchapter B of chapter 1 of the Internal 


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1 Revenue Code of 1986, as amended by section 3, is 

2 amended by adding at the end the following new item: 

‘‘Sec. 280J. Limitations for outsourcing employers.’’. 

3 (c) EFFECTIVE DATE.—The amendments made by 

4 this section shall apply to taxable years beginning after 

5 the date of the enactment of this Act. 

6 SEC. 5. AUTHORITY FOR FEDERAL AGENCIES TO TAKE THE 

7 OUTSOURCING OF JOBS FROM THE UNITED 

8 STATES INTO ACCOUNT FOR GRANTS, LOANS, 

9 AND LOAN GUARANTEES. 

10 (a) DISCLOSURE OF OUTSOURCING OF JOBS.— 

11 (1) IN GENERAL.—The head of any Federal 

12 agency, or their delegate, shall require any entity 

13 that submits a request for an applicable agency ac14 tion to disclose in the request if such entity, or any 

15 subsidiary of such entity, owns a facility for which 

16 there is an outsourcing event during the 3-year pe17 riod ending on the date of the submission of the re18 quest. 

19 (2) OUTSOURCING EVENT.—For purposes of 

20 paragraph (1), the term ‘‘outsourcing event’’ means 

21 a plant closing or mass layoff (as described in sec22 tion 2(a) of the Worker Adjustment and Retraining 

23 Notification Act) in which the employment loss (ex24 cluding any part-time employees) for positions which 

25 will be moved to a country outside of the United 


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1 States, as determined pursuant to the outsourcing 

2 statement (as described in paragraph (1) of such 

3 section 3(e) of such Act), exceeds 50 employees. 

4 (b) CONSIDERATION AUTHORITY.— 

5 (1) IN GENERAL.—In considering a request by 

6 an entity for an applicable agency action, the head 

7 of any Federal agency, as well as any officers, em8 ployees, and contractors of such Agency, shall take 

9 into account any disclosure made pursuant to sub10 section (a) for purposes of such request. 

11 (2) NEGATIVE PREFERENCE.—The head of any 

12 Federal agency shall establish a negative preference 

13 of not less than 10 percent of the scoring evaluation 

14 for any request for an applicable agency action by 

15 an entity that makes a disclosure pursuant to sub16 section (a). 

17 (c) SENSE OF CONGRESS.—It is the sense of Con18 gress that Federal agencies should, in considering requests 

19 by entities for any applicable agency action, exclude enti20 ties making a disclosure of an outsourcing event pursuant 

21 to subsection (a) on the grounds that the actions described 

22 in the disclosures are against the public interests of the 

23 United States. 


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1 (d) ANNUAL REPORT.—The head of each Federal 

2 agency shall submit to Congress each year a report on the 

3 following: 

4 (1) The number of entities making a disclosure 

5 of an outsourcing event pursuant to subsection (a) 

6 in regards to a request for applicable agency action 

7 during the preceding year. 

8 (2) The number of requests for applicable agen9 cy action which were granted by the agency during 

10 the preceding year in which such disclosures were 

11 taken into account. 

12 (e) APPLICABLE AGENCY ACTION.—For purposes of 

13 this section, the term ‘‘applicable agency action’’ means 

14 any grant, loan, or loan guarantee awarded or issued by 

15 a Federal agency. 

16 SEC. 6. RECAPTURE OF CREDITS FOR OUTSOURCING EM17 PLOYERS. 

18 (a) IN GENERAL.—Part IV of subchapter A of chap19 ter 1 of the Internal Revenue Code of 1986 is amended 

20 by adding at the end the following new subpart: 

21 ‘‘Subpart H—Recapture of Credits for Outsourcing 

22 Employers 

‘‘Sec. 54. Recapture of credits for outsourcing employers. 


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1 ‘‘SEC. 54. RECAPTURE OF CREDITS FOR OUTSOURCING EM2 PLOYERS. 

3 ‘‘(a) IN GENERAL.—Pursuant to regulations pre4 scribed by the Secretary, in the case of a taxpayer which 

5 owns a facility for which there is an outsourcing event dur6 ing the taxable year, the tax under this chapter for such 

7 taxable year shall be increased by the amount equal to 

8 the sum of— 

9 ‘‘(1) any credits allowed under this chapter re10 lating to expenses for design, construction, oper11 ation, or maintenance of such facility during the 5 

12 taxable years preceding such taxable year, and 

13 ‘‘(2) any grants provided by the Secretary in 

14 lieu of credits described in paragraph (1) during the 

15 5 taxable years preceding such taxable year. 

16 ‘‘(b) OUTSOURCING EVENT.—For purposes of sub17 section (a), the term ‘outsourcing event’ means a plant 

18 closing or mass layoff (as described in section 2(a) of the 

19 Worker Adjustment and Retraining Notification Act) in 

20 which the employment loss (excluding any part-time em21 ployees) for positions which will be moved to a country 

22 outside of the United States, as determined pursuant to 

23 the outsourcing statement (as described in paragraph (1) 

24 of such section 3(e) of such Act) served by the taxpayer 

25 during the taxable year, exceeds 50 employees. 


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1 ‘‘(c) EXPANDED AFFILIATED GROUP TREATED AS

2 SINGLE TAXPAYER.—For purposes of this section, the 

3 members of an expanded affiliated group (as defined in 

4 section 280I(b)(4)) shall be treated as a single taxpayer.’’. 

5 (b) CLERICAL AMENDMENT.—The table of subparts 

6 for part IV of subchapter A of chapter 1 of such Code 

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

‘‘SUBPART H—RECAPTURE OF CREDITS FOR OUTSOURCING EMPLOYERS’’. 

8 (c) EFFECTIVE DATE.—The amendments made by 

9 this section shall apply to taxable years beginning after 

10 the date of the enactment of this Act. 

11 SEC. 7. CREDIT FOR INSOURCING EXPENSES. 

12 (a) IN GENERAL.—Subpart D of part IV of sub13 chapter A of chapter 1 of the Internal Revenue Code of 

14 1986 is amended by adding at the end the following new 

15 section: 

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

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

18 insourcing expenses credit for any taxable year is an 

19 amount equal to 20 percent of the eligible insourcing ex20 penses of the taxpayer which are taken into account in 

21 such taxable year under subsection (d). 

22 ‘‘(b) ELIGIBLE INSOURCING EXPENSES.—For pur23 poses of this section— 

24 ‘‘(1) IN GENERAL.—The term ‘eligible insourc25 ing expenses’ means— 


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

2 the taxpayer in connection with the elimination 

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

4 member of any expanded affiliated group in 

5 which the taxpayer is also a member) located 

6 outside the United States, and 

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

8 the taxpayer in connection with the establish9 ment of any business unit of the taxpayer (or 

10 of any member of any expanded affiliated group 

11 in which the taxpayer is also a member) located 

12 within— 

13 ‘‘(i) a HUBZone (as defined in sec14 tion 3(p)(2) of the Small Business Act (15 

15 U.S.C. 632(p)(2))), or 

16 ‘‘(ii) a low-income community (as de17 scribed in section 45D(e)), 

18 if such establishment constitutes the relocation 

19 of the business unit so eliminated. For purposes 

20 of the preceding sentence, a relocation shall not 

21 be treated as failing to occur merely because 

22 such elimination occurs in a different taxable 

23 year than such establishment. 

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

25 expenses’ means— 


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

2 allowed to the taxpayer under section 162, and 

3 ‘‘(B) permit and license fees, lease broker4 age fees, equipment installation costs, and, to 

5 the extent provided by the Secretary, other 

6 similar expenses. 

7 Such term does not include any compensation which 

8 is paid or incurred in connection with severance 

9 from employment and, to the extent provided by the 

10 Secretary, any similar amount. 

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

12 means— 

13 ‘‘(A) any trade or business, and 

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

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

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

17 term ‘expanded affiliated group’ means an affiliated 

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

19 without regard to section 1504(b)(3) and by sub20 stituting ‘more than 50 percent’ for ‘at least 80 per21 cent’ each place it appears in section 1504(a). A 

22 partnership or any other entity (other than a cor23 poration) shall be treated as a member of an ex24 panded affiliated group if such entity is controlled 

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1 bers of such group (including any entity treated as 

2 a member of such group by reason of this para3 graph). 

4 ‘‘(5) EXPENSES MUST BE PURSUANT TO

5 INSOURCING PLAN.—Amounts shall be taken into ac6 count under paragraph (1) only to the extent that 

7 such amounts are paid or incurred pursuant to a 

8 written plan to carry out the relocation described in 

9 paragraph (1). 

10 ‘‘(6) OPERATING EXPENSES NOT TAKEN INTO

11 ACCOUNT.—Any amount paid or incurred in connec12 tion with the on-going operation of a business unit 

13 shall not be treated as an amount paid or incurred 

14 in connection with the establishment or elimination 

15 of such business unit. 

16 ‘‘(c) INCREASED DOMESTIC EMPLOYMENT REQUIRE17 MENT.—No credit shall be allowed under this section un18 less the number of full-time equivalent employees of the 

19 taxpayer for the taxable year for which the credit is 

20 claimed exceeds the number of full-time equivalent em21 ployees of the taxpayer for the last taxable year ending 

22 before the first taxable year in which such eligible 

23 insourcing expenses were paid or incurred. For purposes 

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

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


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1 applicable rules of section 45R(e)). All employers treated 

2 as a single employer under subsection (b), (c), (m), or (o) 

3 of section 414 shall be treated as a single employer for 

4 purposes of this subsection. 

5 ‘‘(d) CREDIT ALLOWED UPON COMPLETION OF

6 INSOURCING PLAN.— 

7 ‘‘(1) IN GENERAL.—Except as provided in para8 graph (2), eligible insourcing expenses shall be taken 

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

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

11 has been completed and all eligible insourcing ex12 penses pursuant to such plan have been paid or in13 curred. 

14 ‘‘(2) ELECTION TO APPLY EMPLOYMENT TEST

15 AND CLAIM CREDIT IN FIRST FULL TAXABLE YEAR

16 AFTER COMPLETION OF PLAN.—If the taxpayer 

17 elects the application of this paragraph, eligible 

18 insourcing expenses shall be taken into account 

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

20 the taxable year described in paragraph (1). 

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

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

23 ‘United States’ shall be treated as including each posses24 sion of the United States (including the Commonwealth 


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1 of Puerto Rico and the Commonwealth of the Northern 

2 Mariana Islands). 

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

4 such regulations or other guidance as may be necessary 

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

6 (b) CREDIT TO BE PART OF GENERAL BUSINESS

7 CREDIT.—Subsection (b) of section 38 of such Code is 

8 amended by striking ‘‘plus’’ at the end of paragraph (32), 

9 by striking the period at the end of paragraph (33) and 

10 inserting ‘‘, plus’’, and by adding at the end the following 

11 new paragraph: 

12 ‘‘(34) the insourcing expenses credit determined 

13 under section 45U(a).’’. 

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

15 for subpart D of part IV of subchapter A of chapter 1 

16 of such Code is amended by adding at the end the fol17 lowing new item: 

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

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

19 this section shall apply to amounts paid or incurred after 

20 the date of the enactment of this Act. 

21 (e) APPLICATION TO UNITED STATES POSSES22 SIONS.— 

23 (1) PAYMENTS TO POSSESSIONS.— 

24 (A) MIRROR CODE POSSESSIONS.—The 

25 Secretary of the Treasury shall make periodic 


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1 payments to each possession of the United 

2 States with a mirror code tax system in an 

3 amount equal to the loss to that possession by 

4 reason of section 45U of the Internal Revenue 

5 Code of 1986. Such amount shall be determined 

6 by the Secretary of the Treasury based on in7 formation provided by the government of the re8 spective possession. 

9 (B) OTHER POSSESSIONS.—The Secretary 

10 of the Treasury shall make annual payments to 

11 each possession of the United States which does 

12 not have a mirror code tax system in an 

13 amount estimated by the Secretary of the 

14 Treasury as being equal to the aggregate bene15 fits that would have been provided to residents 

16 of such possession by reason of section 45U of 

17 such Code if a mirror code tax system had been 

18 in effect in such possession. The preceding sen19 tence shall not apply with respect to any posses20 sion of the United States unless such possession 

21 has a plan, which has been approved by the 

22 Secretary of the Treasury, under which such 

23 possession will promptly distribute such pay24 ment to the residents of such possession. 


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1 (2) COORDINATION WITH CREDIT ALLOWED

2 AGAINST UNITED STATES INCOME TAXES.—No cred3 it shall be allowed against United States income 

4 taxes under section 45U of such Code to any per5 son— 

6 (A) to whom a credit is allowed against 

7 taxes imposed by the possession by reason of 

8 such section, or 

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

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

11 (3) DEFINITIONS AND SPECIAL RULES.— 

12 (A) POSSESSIONS OF THE UNITED

13 STATES.—For purposes of this section, the 

14 term ‘‘possession of the United States’’ includes 

15 the Commonwealth of Puerto Rico and the 

16 Commonwealth of the Northern Mariana Is17 lands. 

18 (B) MIRROR CODE TAX SYSTEM.—For pur19 poses of this section, the term ‘‘mirror code tax 

20 system’’ means, with respect to any possession 

21 of the United States, the income tax system of 

22 such possession if the income tax liability of the 

23 residents of such possession under such system 

24 is determined by reference to the income tax 


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1 laws of the United States as if such possession 

2 were the United States. 

3 (C) TREATMENT OF PAYMENTS.—For pur4 poses of section 1324(b)(2) of title 31, United 

5 States Code, the payments under this section 

6 shall be treated in the same manner as a refund 

7 due from sections referred to in such section 

8 1324(b)(2). 

9 SEC. 8. AUTHORITY FOR FEDERAL CONTRACTING OFFI10 CERS TO TAKE THE OUTSOURCING OF JOBS 

11 FROM THE UNITED STATES INTO ACCOUNT 

12 IN AWARDING CONTRACTS. 

13 (a) DEPARTMENT OF DEFENSE AND RELATED

14 AGENCY CONTRACTS.— 

15 (1) CONSIDERATION OF OUTSOURCING.— 

16 (A) IN GENERAL.—Chapter 222 of title 

17 10, United States Code, as added by section 

18 1812(a) of the William M. (Mac) Thornberry 

19 National Defense Authorization Act for Fiscal 

20 Year 2021 (Public Law 116–283), is amended 

21 by inserting after section 3227 the following 

22 new section: 

23 ‘‘§ 3228. Contracts: consideration of outsourcing of 

24 jobs 

25 ‘‘(a) DISCLOSURE OF OUTSOURCING OF JOBS.— 


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1 ‘‘(1) IN GENERAL.—The head of an agency 

2 shall require a contractor that submits a bid or pro3 posal in response to a solicitation issued by the 

4 agency to disclose in that bid or proposal if the con5 tractor, or a subsidiary of the contractor, owns a fa6 cility for which there is an outsourcing event during 

7 the three-year period ending on the date of the sub8 mittal of the bid or proposal. 

9 ‘‘(2) OUTSOURCING EVENT.—For purposes of 

10 paragraph (1), the term ‘outsourcing event’ means a 

11 plant closing or mass layoff (as described in section 

12 2(a) of the Worker Adjustment and Retraining Noti13 fication Act) in which the employment loss (exclud14 ing any part-time employees) for positions which will 

15 be moved to a country outside of the United States, 

16 as determined pursuant to the outsourcing state17 ment (as described in paragraph (1) of such section 

18 3(e) of such Act) served by the taxpayer during the 

19 taxable year, exceeds 50 employees. 

20 ‘‘(b) CONSIDERATION AUTHORIZED.—(1) Agency 

21 contracting officers considering bids or proposals in re22 sponse to a solicitation issued by the agency shall take 

23 into account any disclosure made pursuant to subsection 

24 (a) in such bids and proposals. 


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1 ‘‘(2) The head of an agency shall establish a negative 

2 preference of no less than 10 percent of the cost of a con3 tract for purposes of evaluating a bid or proposal of a con4 tractor that makes a disclosure pursuant to subsection (a). 

5 ‘‘(c) SENSE OF CONGRESS.—It is the sense of Con6 gress that agency contracting officers should, using sec7 tion 3203(a) of this title, exclude contractors making a 

8 disclosure pursuant to subsection (a) in response to solici9 tations issued by the agency from the bidding process in 

10 connection with such solicitations on the grounds that the 

11 actions described in the disclosures are against the public 

12 interests of the United States. 

13 ‘‘(d) ANNUAL REPORT.—The head of each agency 

14 shall submit to Congress each year a report on the fol15 lowing: 

16 ‘‘(1) The number of solicitations made by the 

17 agency during the preceding year for which disclo18 sures were made pursuant to subsection (a) in re19 sponsive bids or proposals. 

20 ‘‘(2) The number of contracts awarded by the 

21 agency during the preceding year in which such dis22 closures were taken into account in the contract 

23 award.’’. 

24 (B) CLERICAL AMENDMENT.—The table of 

25 sections at the beginning of chapter 222 of such 


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1 title, as added by such section 1812(a), is 

2 amended by inserting after the item relating to 

3 section 3227 the following new item: 

‘‘3228. Contracts: consideration of outsourcing of jobs.’’. 

4 (2) EXCLUSION OF FIRMS FROM SOURCES.— 

5 Section 3203(a) of such title, as added by section 

6 1812(a) of the William M. (Mac) Thornberry Na7 tional Defense Authorization Act for Fiscal Year 

8 2021 (Public Law 116–283), is amended— 

9 (A) by redesignating subsection (c) as sub10 section (d); 

11 (B) by inserting after subsection (b) the 

12 following new subsection: 

13 ‘‘(c) EXCLUSION OF SOURCES THAT OUTSOURCE

14 JOBS.—The head of an agency may provide for the pro15 curement of property and services covered by this chapter 

16 using competitive procedures but excluding a source mak17 ing a disclosure pursuant to section 3228(a) of this title 

18 in the bid or proposal in response to the solicitation issued 

19 by the agency if the head of the agency determines that 

20 the actions described by disclosure are against the public 

21 interests of the United States and the source is to be ex22 cluded on those grounds. Any such determination shall 

23 take into account the sense of Congress set forth in section 

24 3228(c) of this title.’’; and 


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1 (C) in subsection (d), as so redesignated, 

2 by striking ‘‘paragraphs (1) and (2)’’ and in3 serting ‘‘subsections (a), (b), and (c)’’. 

4 (b) OTHER FEDERAL CONTRACTS.— 

5 (1) CONSIDERATION OF OUTSOURCING.—Chap6 ter 35 of title 41, United States Code, is amended 

7 by inserting after section 3303 the following new 

8 section: 

9 ‘‘§ 3303a. Bidders outsourcing jobs: disclosure of out10 sourcing; consideration of outsourcing in 

11 award; exclusion from sources 

12 ‘‘(a) DISCLOSURE OF OUTSOURCING OF JOBS.— 

13 ‘‘(1) IN GENERAL.—The head of an executive 

14 agency shall require a contractor that submits a bid 

15 or proposal in response to a solicitation issued by 

16 the executive agency to disclose in that bid or pro17 posal if the contractor, or a subsidiary of the con18 tractor, owns a facility for which there is an out19 sourcing event during the three-year period ending 

20 on the date of the submittal of the bid or proposal. 

21 ‘‘(2) OUTSOURCING EVENT.—For purposes of 

22 paragraph (1), the term ‘outsourcing event’ means a 

23 plant closing or mass layoff (as described in section 

24 2(a) of the Worker Adjustment and Retraining Noti25 fication Act) in which the employment loss (excludVerDate Sep 11 2014 02:56 Jun 05, 2021 Jkt 019200 PO 00000 Frm 00026 Fmt 6652 Sfmt 6201 E:\BILLS\H2745.IH H2745

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1 ing any part-time employees) for positions which will 

2 be moved to a country outside of the United States, 

3 as determined pursuant to the outsourcing state4 ment (as described in paragraph (1) of such section 

5 3(e) of such Act) served by the taxpayer during the 

6 taxable year, exceeds 50 employees. 

7 ‘‘(b) CONSIDERATION AUTHORIZED.—(1) Con8 tracting officers of an executive agency considering bids 

9 or proposals in response to a solicitation issued by the ex10 ecutive agency shall take into account any disclosure made 

11 pursuant to subsection (a) in such bids and proposals. 

12 ‘‘(2) The head of an executive agency shall establish 

13 a negative preference of no less than 10 percent of the 

14 cost of a contract for purposes of evaluating a bid or pro15 posal of a contractor that makes a disclosure pursuant to 

16 subsection (a). 

17 ‘‘(c) EXCLUSION FROM SOURCES.— 

18 ‘‘(1) IN GENERAL.—The head of an executive 

19 agency may provide for the procurement of property 

20 and services using competitive procedures but ex21 cluding a source making a disclosure under sub22 section (a) in the bid or proposal in response to the 

23 solicitation issued by the executive agency if the 

24 head of the executive agency determines that the ac25 tions described by disclosure are against the public 


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1 interests of the United States and the source is to 

2 be excluded on those grounds. Any such determina3 tion shall take into account the sense of Congress 

4 set forth in paragraph (2). 

5 ‘‘(2) SENSE OF CONGRESS.—It is the sense of 

6 Congress that contracting officers of executive agen7 cies may use paragraph (1) to exclude contractors 

8 making a disclosure pursuant to subsection (a) in re9 sponse to a solicitation issued by the executive agen10 cy from the bidding process in connection with the 

11 solicitation on the grounds that the actions described 

12 by the disclosure are against the public interests of 

13 the United States. 

14 ‘‘(d) ANNUAL REPORT.—The head of each executive 

15 agency shall submit to Congress each year a report on the 

16 following: 

17 ‘‘(1) The number of solicitations made by the 

18 executive agency during the preceding year for which 

19 disclosures were made pursuant to subsection (a) in 

20 responsive bids or proposals. 

21 ‘‘(2) The number of contracts awarded to con22 tractors that disclosed having outsourced more than 

23 50 jobs during the preceding three years.’’. 

24 (2) CLERICAL AMENDMENT.—The table of sec25 tions at the beginning of chapter 35 of such title is 


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1 amended by inserting after the item relating to sec2 tion 3303 the following new item: 

‘‘3303a. Bidders outsourcing jobs: disclosure of outsourcing; consideration of 

outsourcing in award; exclusion from sources.’’. 

3 (3) CONFORMING AMENDMENT.—Section 

4 3301(a) of such title is amended by inserting 

5 ‘‘3303a(c),’’ after ‘‘3303,’’. 

6 (c) REGULATIONS.— 

7 (1) IN GENERAL.—Not later than 180 days 

8 after the date of the enactment of this Act, the Fed9 eral Acquisition Regulatory Council, in consultation 

10 with the heads of relevant agencies, shall amend the 

11 Federal Acquisition Regulation and the Defense 

12 Federal Acquisition Regulation Supplement to carry 

13 out the requirements of section 3303a of title 41, 

14 United States Code, and section 3228 of title 10, 

15 United States Code, as added by this section. 

16 (2) DEFINITION OF OUTSOURCING.—For pur17 poses of defining outsourcing pursuant to paragraph 

18 (1), the Federal Acquisition Regulatory Council may 

19 utilize regulations prescribed by the Secretary of 

20 Labor. 

21 (d) RULE OF CONSTRUCTION.—This section, and the 

22 amendments made by this section, shall be applied in a 

23 manner consistent with United States obligations under 

24 international agreements. 


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1 SEC. 9. CURRENT YEAR INCLUSION OF NET CFC TESTED IN2 COME. 

3 (a) REPEAL OF TAX-FREE DEEMED RETURN ON IN4 VESTMENTS.— 

5 (1) IN GENERAL.—Section 951A(a) of the In6 ternal Revenue Code of 1986 is amended by striking 

7 ‘‘global intangible low-taxed income’’ and inserting 

8 ‘‘net CFC tested income’’. 

9 (2) CONFORMING AMENDMENTS.— 

10 (A) Section 951A of such Code is amended 

11 by striking subsections (b) and (d). 

12 (B) Section 951A(e)(1) of such Code is 

13 amended by striking ‘‘subsections (b), 

14 (c)(1)(A), and’’ and inserting ‘‘subsections 

15 (c)(1)(A) and’’. 

16 (C) Section 951A(f) of such Code is 

17 amended to read as follows: 

18 ‘‘(f) TREATMENT AS SUBPART F INCOME FOR CER19 TAIN PURPOSES.— 

20 ‘‘(1) IN GENERAL.—Except as provided in para21 graph (2), any net CFC tested income included in 

22 gross income under subsection (a) shall be treated in 

23 the same manner as an amount included under sec24 tion 951(a)(1)(A) for purposes of applying sections 

25 168(h)(2)(B), 535(b)(10), 851(b), 904(h)(1), 959, 

26 961, 962, 993(a)(1)(E), 996(f)(1), 1248(b)(1), 


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1 1248(d)(1), 6501(e)(1)(C), 6654(d)(2)(D), and 

2 6655(e)(4). 

3 ‘‘(2) EXCEPTION.—The Secretary shall provide 

4 rules for the application of paragraph (1) to other 

5 provisions of this title in any case in which the de6 termination of subpart F income is required to be 

7 made at the level of the controlled foreign corpora8 tion.’’. 

9 (D) Section 960(d)(2)(A) of such Code is 

10 amended by striking ‘‘global intangible low11 taxed income (as defined in section 951A(b))’’ 

12 and inserting ‘‘net CFC tested income (as de13 fined in section 951A(c))’’. 

14 (b) REPEAL OF REDUCED RATE OF TAX ON NET

15 CFC TESTED INCOME.— 

16 (1) IN GENERAL.—Part VIII of subchapter B 

17 of chapter 1 of such Code is amended by striking 

18 section 250 (and by striking the item relating to 

19 such section in the table of sections of such part). 

20 (2) CONFORMING AMENDMENTS.— 

21 (A) Section 59A(c)(4)(B)(i) of such Code 

22 is amended by striking ‘‘section 172, 245A, or 

23 250’’ and inserting ‘‘section 172 or 245A’’. 

24 (B) Section 172(d) of such Code is amend25 ed by striking paragraph (9). 


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1 (C) Section 246(b)(1) of such Code is 

2 amended— 

3 (i) by striking ‘‘subsection (a) and (b) 

4 of section 245, and section 250’’ and in5 serting ‘‘and subsection (a) and (b) of sec6 tion 245’’; and 

7 (ii) by striking ‘‘subsection (a) and 

8 (b) of section 245, and 250’’ and inserting 

9 ‘‘and subsection (a) and (b) of section 

10 245’’. 

11 (D) Section 469(i)(3)(F)(iii) is amended 

12 by striking ‘‘222, and 250’’ and inserting ‘‘and 

13 222’’. 

14 (c) NET CFC TESTED INCOME DETERMINED WITH15 OUT REGARD TO HIGH TAX FOREIGN INCOME.—Section 

16 951A(c)(2)(A)(i) of such Code is amended by redesig17 nating subclauses (IV) and (V) as subclauses (V) and 

18 (VI), respectively, and by inserting after subclause (III) 

19 the following new subclause: 

20 ‘‘(IV) any item of income subject 

21 to an effective rate of income tax im22 posed by a foreign country greater 

23 than the maximum rate of tax speci24 fied in section 11,’’. 


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1 (d) REPEAL OF EXCLUSION OF FOREIGN OIL AND

2 GAS EXTRACTION INCOME FROM THE DETERMINATION

3 OF TESTED INCOME.—Section 951A(c)(2)(A)(i) of such 

4 Code, as amended by subsection (c) is amended— 

5 (1) by adding ‘‘and’’ at the end of subclause 

6 (IV); 

7 (2) by striking ‘‘and’’ at the end of subclause 

8 (V) and inserting ‘‘over’’; and 

9 (3) by striking subclause (VI). 

10 (e) INCREASE IN DEEMED PAID CREDIT FOR TAXES

11 PROPERLY ATTRIBUTABLE TO TESTED INCOME.— 

12 (1) IN GENERAL.—Section 960(d) of such Code 

13 is amended by striking ‘‘80 percent of’’. 

14 (2) CONFORMING AMENDMENT.—Section 78 of 

15 such Code is amended by striking ‘‘(determined 

16 without regard to the phrase ‘‘80 percent of’’ in sub17 section (d)(1) thereof)’’. 

18 (f) EFFECTIVE DATE.— 

19 (1) IN GENERAL.—Except as otherwise pro20 vided in this subsection, the amendments made by 

21 this section shall apply to taxable years of foreign 

22 corporations beginning after December 31, 2020, 

23 and to taxable years of United States shareholders 

24 in which or with which such taxable years of foreign 

25 corporations end. 


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1 (2) REPEAL OF REDUCED RATE OF TAX; IN2 CREASE IN DEEMED PAID CREDIT.—The amend3 ments made by subsection (b) and (e) shall apply to 

4 taxable years beginning after December 31, 2020. 

Æ 


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