Stop Subsidizing Multimillion Dollar Corporate Bonuses Act

To amend the Internal Revenue Code of 1986 to expand the denial of deduction for certain excessive employee remuneration, and for other purposes. 1. Short title This Act may be cited as the Stop Subsidizing Multimillion Dollar Corporate Bonuses Act 2. Expansion of denial of deduction for certain excessive employee remuneration (a) Application to all current and former employees (1) In general Section 162(m) (A) by striking covered employee covered individual (B) by striking such employee such individual (2) Covered individual Section 162(m)(3) of such Code is amended to read as follows: (3) Covered individual For purposes of this subsection, the term covered individual . (3) Conforming amendments (A) Section 48D(b)(3)(A) of such Code is amended by inserting (as in effect for taxable years beginning before January 1, 2015) section 162(m)(3) (B) Section 409A(b)(3)(D)(ii) of such Code is amended by inserting (as in effect for taxable years beginning before January 1, 2015) section 162(m)(3) (b) Expansion of applicable employee remuneration (1) Elimination of exception for commission-based pay (A) In general Section 162(m)(4) of such Code, as amended by subsection (a), is amended by striking subparagraph (B) and by redesignating subparagraphs (C) through (G) as subparagraphs (B) through (F), respectively. (B) Conforming amendments (i) Section 162(m)(5) of such Code is amended— (I) by striking subparagraphs (B), (C), and (D) thereof subparagraphs (B) and (C) thereof (II) by striking subparagraphs (F) and (G) subparagraphs (E) and (F) (ii) Section 162(m)(6) of such Code is amended— (I) by striking subparagraphs (B), (C), and (D) thereof subparagraphs (B) and (C) thereof (II) by striking subparagraphs (F) and (G) subparagraphs (E) and (F) (2) Inclusion of performance-based compensation (A) In general Section 162(m)(4) of such Code, as amended by subsection (a) and paragraph (1) of this subsection, is amended by striking subparagraph (B) and redesignating subparagraphs (C) through (F) as subparagraphs (B) through (E), respectively. (B) Conforming amendments (i) Section 162(m)(5) of such Code, as amended by paragraph (1), is amended— (I) by striking subparagraphs (B) and (C) thereof subparagraph (B) thereof (II) by striking subparagraphs (E) and (F) subparagraphs (D) and (E) (ii) Section 162(m)(6) of such Code, as amended by paragraph (1), is amended— (I) by striking subparagraphs (B) and (C) thereof subparagraph (B) thereof (II) by striking subparagraphs (E) and (F) subparagraphs (D) and (E) (c) Expansion of applicable employer Section 162(m)(2) of such Code is amended to read as follows: (2) Publicly held corporation For purposes of this subsection, the term publicly held corporation 15 U.S.C. 78c (A) that has a class of securities registered under section 12 of such Act ( 15 U.S.C. 78l (B) that is required to file reports under section 15(d) of such Act ( 15 U.S.C. 780(d) . (d) Regulatory authority (1) In general Section 162(m) of such Code is amended by adding at the end the following new paragraph: (7) Regulations The Secretary may prescribe such guidance, rules, or regulations, including with respect to reporting, as are necessary to carry out the purposes of this subsection. . (2) Conforming amendment Section 162(m)(6) of such Code is amended by striking subparagraph (H). (e) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2014.

Summary: Stop Subsidizing Multimillion Dollar Corporate Bonuses Act Amends the Internal Revenue Code, with respect to the $1 million limitation on the deductibility of employee compensation, to: (1) extend such limitation to any individual who is a current or former officer, director, or employee of a publicly-held corporation; (2) eliminate the exemption from such limitation for compensation payable on a commission basis or upon the attainment of a performance goal; and (3) make such limitation applicable to all publicly-held corporations that are required by the Securities and Exchange Commission to register securities and provide periodic reports to their investors.