retary, with respect to the program 
carried out under the preceding grant. 
(ii) GRANT RENEWAL APPLICATION.— 
Such an eligible entity may submit an ap-
plication under subsection (e) for an addi-
tional grant prior to the last day of the 
grant period of the preceding grant award-
ed to the eligible entity under this section. 
(iii) 
EXPEDITED
REVIEW
PER-
MITTED.—The Secretary may provide an 
expedited review process for an eligible en-
tity’s application for an additional grant, 
which may include a performance review of 
the program carried out under the pre-
ceding grant awarded to the eligible entity 
under this section. 
(c) JOB GUARANTEE PROGRAMS.— 
(1) IN GENERAL.—Subject to paragraph (2), a 
job guarantee program meets the requirements of 
this subsection if each job provided under such pro-
gram— 
(A) is available to any individual who— 
(i) is 18 years of age or older; and 
(ii) has principal residence in the eli-
gible entity as of the date that such indi-
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vidual applies for a job under such pro-
gram; 
(B) is, with respect to each individual who 
receives a job under the program, included as 
part of an established bargaining unit and cov-
ered by any applicable collective bargaining 
agreement in effect if similarly situated employ-
ees are part of such unit and represented by an 
exclusive bargaining representative; and 
(C) provides each such individual the fol-
lowing: 
(i) A choice between coverage under— 
(I) a health insurance program 
that is comparable to that offered to 
Federal employees under the Federal 
Employee Health Benefits Program; 
or 
(II) the health insurance pro-
gram under an applicable collective 
bargaining agreement as provided for 
under subparagraph (B). 
(ii) The following leave— 
(I) family and medical leave con-
sistent with the provisions of the 
Family and Medical Leave Act of 
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1993 and applicable State law, except 
that such leave shall be paid leave; 
and 
(II) paid sick leave as provided 
by the Emergency Paid Sick Leave 
Act under division E of the Families 
First Coronavirus Response Act (29 
U.S.C. 2601 note). 
(iii) The paid training and career de-
velopment opportunities developed pursu-
ant to subsection (j). 
(iv) A wage that is not less than the 
highest of the following rates: 
(I) $17 per hour. 
(II) The hourly wage required to 
be paid to employees in the area to be 
served under the program. 
(III) The prevailing wage in the 
area involved for a similar job as re-
quired by chapter 67 of title 41, 
United States Code, and other related 
laws. 
(IV) The applicable wage under 
an applicable collective bargaining 
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agreement as provided for under sub-
paragraph (B). 
(2) SUSPENSIONS.— 
(A) IN GENERAL.—An eligible individual 
who receives job under a job guarantee program 
under this section may be released or suspended 
from such job if such individual— 
(i) fails to perform the stipulated du-
ties; or 
(ii) is generally disruptive to the work-
place involved. 
(B) REVIEW PROCEDURES.—The Secretary 
shall establish procedures to provide for an op-
portunity for a review of any such release or 
suspension. 
(d) OTHER USES
OF FUNDS.—A grant awarded 
under this section may be used to provide workers in a 
job guarantee program with— 
(1) supportive services, which may include food, 
transportation, child care, dependent care, housing, 
clothing and personal protection equipment, and 
needs-related payments, that are necessary to enable 
an individual to participate in activities authorized 
under this section; 
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(2) access to a workplace learning advisor to 
support the education, skill development, job train-
ing, career planning, and credentials required to 
progress toward career goals of such employees in 
order to meet employer requirements related to job 
openings and career advancements that support eco-
nomic self-sufficiency; 
(3) adult education and literacy activities, in-
cluding those provided by public libraries; 
(4) activities that assist justice-involved individ-
uals, formerly incarcerated individuals, and individ-
uals with criminal records in reentering the work-
force; and 
(5) financial literacy activities including those 
described in section 129(b)(2)(D) of the Workforce 
Innovation 
and 
Opportunity 
Act 
(29 
U.S.C. 
3164(b)(2)(D)). 
(e) APPLICATIONS.—An eligible entity seeking a 
grant under this section shall submit an application to the 
Secretary at such time, in such manner, and containing 
such information as the Secretary may require. Such ap-
plication shall include— 
(1) a description of the geographic area and 
population that the entity intends to serve under the 
job guarantee program established under the grant, 
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including the area unemployment rate, underemploy-
ment rate, unemployment rate for individuals with 
disabilities, poverty rate, housing vacancy rate, crime 
rate, household income distribution, home-ownership 
rate, labor force participation rate, and educational 
attainment distribution; 
(2) to the extent practicable, a description of 
the jobs that will be offered under the job guarantee 
program, including— 
(A) a description of supports provided to 
individuals with disabilities and accommoda-
tions required under the Americans with Dis-
abilities Act of 1990 (42 U.S.C. 12101 et seq.); 
and 
(B) a description of supports and proce-
dures to ensure job access and opportunities for 
individuals with criminal records, including in-
formation on physical and programmatic acces-
sibility, in accordance with section 188 of the 
Workforce Innovation and Opportunity Act (29 
U.S.C. 3248), if applicable, and the Americans 
with Disabilities Act of 1990, for individuals 
with disabilities; 
(3) the need in the area for jobs to be per-
formed, including for jobs designated as a high-skill, 
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high-wage, or in-demand industry sector or occupa-
tion by the Secretary, State board, or local board; 
(4) a description of State, local, or philan-
thropic funding, including through coordination and 
in-kind or nonfinancial support, if any, that will be 
provided to assist in carrying out the job guarantee 
program; 
(5) an assurance that the eligible entity will es-
tablish— 
(A) a public internet website, in conjunc-
tion with the Secretary, to post all available 
jobs under the job guarantee program; and 
(B) a process for individuals to apply for 
such jobs; 
(6) a comprehensive plan to describe how the 
funding under the program will leverage existing or 
anticipated local, State, and Federal funding; 
(7) an assurance that necessary administrative 
data systems and information technology infrastruc-
ture are available, or will be available, to provide for 
full participation in the evaluation under subsection 
(m); 
(8) a description of how the eligible entity will 
comply with the requirements described in sub-
section (c)(1)(D); 
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(9) an assurance that the entity will enter into 
an allocation agreement with the Secretary under 
subsection (k)(2)(A); and 
(10) an assurance that any job in the energy 
and infrastructure sector provided under the pro-
gram will not exacerbate the impacts of climate 
change. 
(f) SELECTION.—In awarding grants to eligible enti-
ties under this section, the Secretary shall— 
(1) select eligible entities that— 
(A) as of the date of submission of the ap-
plication under subsection (e), has an unem-
ployment rate that (as determined by the Bu-
reau of Labor Statistics based on the most re-
cent data available as of such date or, in the 
case of an eligible entity that is a Tribal entity 
with respect to which no Federal data are avail-
able, based on employment entity submitted by 
the Tribal entity) is at least the lower of— 
(i) 5 percent; or 
(ii) 80 percent of the national unem-
ployment rate; 
(B) in the case of eligible entities seeking 
an additional grant pursuant to subsection 
(b)(3), have not been determined to be ineligible 
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for funds under this section pursuant to sub-
section (k)(2)(B); and 
(2) consider diversity in geographic location, 
urban-rural composition, and political entity, includ-
ing the representation of Tribal entities. 
(g) AMOUNT OF GRANT.— 
(1) ESTABLISHMENT OF FUND.—There is es-
tablished in the Treasury of the United States a sep-
arate account to be known as the ‘‘Job Guarantee 
Program Trust Fund’’ (referred to in this section as 
the ‘‘Fund’’). 
(2) TRANSFERS TO FUND.—There is hereby ap-
propriated to the Fund amounts equivalent to— 
(A) taxes received in the Treasury under 
subchapter C of chapter 36 of the Internal Rev-
enue Code of 1986; and 
(B) interest earned on investment of 
amounts in the Fund under rules similar to the 
rules of section 9602(b) of such Code. 
(3) USE OF AMOUNTS.—The Secretary shall use 
amounts in the Fund to make payments to grantees 
under grants under this section in accordance with 
paragraph (4). 
(4) PAYMENTS.— 
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(A) IN GENERAL.—The Secretary shall de-
termine the annual amount of a grant under 
this section based on a formula to be developed 
by the Secretary. 
(B) 
PAYMENTS.—The 
Secretary 
shall 
make payments to grantees under this section 
based on a standardized payment schedule and 
in a manner determined appropriate by the Sec-
retary. The Secretary shall not make subse-
quent payments to a grantee after the initial 
payment until the grantee certifies to the Sec-
retary that the grantee has expended, trans-
ferred, or obligated not less than 80 percent of 
the most recent payment made under this sub-
section. 
(h) LIMITATIONS.—An eligible entity may not use 
amounts received under a grant under this section to— 
(1) employ individuals who will replace, or lead 
to the displacement of, existing employees, positions, 
or individuals who would otherwise perform similar 
employment; 
(2) disrupt existing contracts or collective bar-
gaining agreements; and 
(3) perform functions otherwise prohibited by 
applicable Federal, State, or local laws. 
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(i) FEDERAL PROVISION
OF JOBS
IN PROGRAM 
SITES.— 
(1) GUIDANCE.—Not later than 30 days after 
the date on which the Secretary awards the first 
grant under this section, the Secretary shall— 
(A) provide guidance to the heads of ap-
propriate Federal agencies to notify such agen-
cies of job guarantee programs established 
under the grants awarded to eligible entities 
under this section, and that such agencies may 
work with such eligible entities to carry out 
such programs on behalf of such eligible entities 
and receive reimbursement for carrying out 
such a program; 
(B) request that, not later than 30 days 
after the date on which the guidance is received 
under subparagraph (A), the heads of such 
agencies notify the Secretary of the number and 
types of jobs that each such agency would make 
available through each of the programs; and 
(C) ensure that each such agency makes 
best efforts to provide jobs through the pro-
grams established under such grants. 
(2) APPLICATION
OF
PROVISIONS.—The re-
quirements of subsection (c) relating to wages and 
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benefits provided to participants in jobs provided 
under job guarantee programs, and the limitations 
in subsection (h), shall apply to Federal agencies 
and jobs provided under this subsection. 
(3) LISTING OF JOBS ON WEBSITE.—The Sec-
retary shall establish procedures to ensure that jobs 
identified under paragraph (1)(B) are listed on the 
appropriate public internet website as provided for 
under subsection (e)(5)(A). 
(j) TRAINING AND DEVELOPMENT.— 
(1) IN GENERAL.—Not later than 30 days after 
the date of enactment of this Act, the Secretary 
shall develop procedures to support a minimum of 1 
week, and up to 8 weeks, of paid training and career 
development opportunities to eligible individuals se-
lected to participate in a program under this section 
in order to enable such individuals to perform duties 
required by such program. 
(2) SPECIFIC POPULATIONS.—With respect to 
individuals with barriers to employment (as defined 
in section 3(24) of the Workforce Innovation and 
Opportunity Act (29 U.S.C. 3102(24)), the training 
period may include specific job-related training and 
counseling and other general skills training to pre-
pare such individuals to reenter the workforce. 
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(k) AUDITS; ALLOCATION AGREEMENTS.— 
(1) AUDITS.—The Secretary, acting through 
the Inspector General of the Department of Labor, 
shall carry out annual audits of the use of grant 
funds provided to eligible entities under this section. 
(2) ALLOCATION AGREEMENTS AND MISUSE OF 
FUNDS.— 
(A) ALLOCATION AGREEMENTS.—An eligi-
ble entity shall enter into an allocation agree-
ment with the Secretary that shall provide that 
the Secretary shall recoup any amounts paid to 
the entity under a grant under this section if 
the results of an audit under paragraph (1) in-
clude a finding that there was an intentional or 
reckless misuse of such funds by such entity. 
(B) LOSS OF ELIGIBILITY.—An eligible en-
tity that is determined to have falsified or oth-
erwise misstated data in any report submitted 
to the Secretary with the intent to deceive or 
mislead the Secretary shall be ineligible to re-
ceive additional funds under this section. 
(l) REPORTS.— 
(1) SUBMISSION OF REPORTS.—Not later than 
90 days after the end of each fiscal year for which 
an eligible entity obligates or expends any amounts 
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made available under a grant under this section, the 
eligible entity shall submit to the Secretary a report 
that— 
(A) specifies the amount of grant funds 
obligated or expended for the preceding fiscal 
year; 
(B) specifies any purposes for which the 
funds were obligated or expended; and 
(C) includes any other information that the 
Secretary may require to more effectively ad-
minister the grant program under this section, 
including the indicators of performance under 
section 116(b)(2)(A)(i) of the Workforce Inno-
vation 
and 
Opportunity 
Act 
(29 
U.S.C. 
3141(b)(2)(A)(i)), with the performance data 
disaggregated by race, ethnicity, sex, age, and 
membership in a population specified in section 
3(24) of such Act (29 U.S.C. 3102(24)). 
(2) PUBLICATION OF REPORTS.—Not later than 
180 days after the end of each fiscal year for which 
an eligible entity obligates or expends any amounts 
made available under a grant under this section, the 
Secretary shall publish such reports from paragraph 
(1) in a searchable online database. 
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(m) EVALUATION.—The Chief Evaluation Officer at 
the Department of Labor shall provide for the conduct of 
an evaluation of each program carried out by an eligible 
entity under this section, using a rigorous design and eval-
uation methods to assess the implementation of the pro-
gram and its impact on, with respect to the area served 
by such program— 
(1) overall employment, public-sector employ-
ment, and private-sector employment; 
(2) private-sector employment, wages, and bene-
fits; 
(3) poverty rate; 
(4) public assistance spending and other Fed-
eral spending in the area served by the program; 
(5) child health and educational outcomes; 
(6) health and well-being of those with mental, 
emotional, and behavioral health needs; 
(7) incarceration rates; 
(8) the environment, including air quality and 
water quality; 
(9) the indicators of performance as described 
in subsection (l)(1)(C); and 
(10) other economic development and individual 
outcome indicators, as determined by the Secretary. 
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(n) EXPANSION OF WORK OPPORTUNITY CREDIT TO 
INCLUDE
PARTICIPANTS
IN
JOB
GUARANTEE
PRO-
GRAMS.— 
(1) IN GENERAL.—Subsection (d) of section 51 
of the Internal Revenue Code of 1986 is amended— 
(A) in paragraph (1)— 
(i) in subparagraph (I), by striking 
‘‘or’’ at the end, 
(ii) in subparagraph (J), by striking 
the period at the end and inserting ‘‘, or’’, 
and 
(iii) by adding at the end the fol-
lowing new subparagraph: 
‘‘(K) a qualified participant in a job guar-
antee program.’’, and 
(B) by adding at the end the following new 
paragraph: 
‘‘(16) QUALIFIED PARTICIPANT IN A JOB GUAR-
ANTEE PROGRAM.—The term ‘qualified participant 
in a job guarantee program’ means any individual 
who is certified by the designated local agency as 
having participated in a job guarantee program 
under section 2 of the Workforce Promotion and Ac-
cess Act for not less than 3 months during the 6- 
month period ending on the hiring date.’’. 
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(2) EFFECTIVE DATE.—The amendments made 
by this subsection shall apply to individuals who 
begin work for the employer after December 31, 
2024. 
(o) APPROPRIATIONS.—From funds in the Treasury 
not otherwise appropriated, there are appropriated to the 
Secretary such sums as may be necessary to carry out this 
section. 
SEC. 3. TRANSACTION TAX. 
(a) IN GENERAL.—Chapter 36 of the Internal Rev-
enue Code of 1986 is amended by inserting after sub-
chapter B the following new subchapter: 
‘‘Subchapter C—Tax on Trading Transactions 
‘‘Sec. 4475. Tax on trading transactions. 
‘‘Sec. 4476. Derivative defined. 
‘‘SEC. 4475. TAX ON TRADING TRANSACTIONS. 
‘‘(a) IMPOSITION OF TAX.—There is hereby imposed 
a tax on each covered transaction with respect to any secu-
rity. 
‘‘(b) RATE OF TAX.—The tax imposed under sub-
section (a) with respect to any covered transaction shall 
be 0.1 percent of the specified base amount with respect 
to such covered transaction. 
‘‘(c) SPECIFIED BASE AMOUNT.—For purposes of 
this section, the term ‘specified base amount’ means— 
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‘‘(1) except as provided in paragraph (2), the 
fair market value of a security (determined as of the 
time of the covered transaction), and 
‘‘(2) in the case of any payment with respect to 
a derivative, the amount of such payment. 
‘‘(d) COVERED TRANSACTION.—For purposes of this 
section— 
‘‘(1) IN GENERAL.—The term ‘covered trans-
action’ means— 
‘‘(A) except as provided in subparagraph 
(B), any purchase if— 
‘‘(i) such purchase occurs on, or is 
subject to the rules of, a qualified board or 
exchange located in the United States, or 
‘‘(ii) the purchaser or seller is a 
United States person, and 
‘‘(B) any transaction with respect to a de-
rivative if— 
‘‘(i) such derivative is traded on, or is 
subject to the rules of, a qualified board or 
exchange located in the United States, or 
‘‘(ii) any party with rights under such 
derivative is a United States person. 
‘‘(2) EXCEPTION FOR INITIAL ISSUES.—No tax 
shall be imposed under subsection (a) on any cov-
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ered transaction with respect to the initial issuance 
of any security described in subparagraph (A), (B), 
or (C) of subsection (e)(1). 
‘‘(e) DEFINITIONS AND SPECIAL RULES.—For pur-
poses of this section— 
‘‘(1) SECURITY.—For purposes of this section, 
the term ‘security’ means— 
‘‘(A) any share of stock in a corporation, 
‘‘(B) any partnership or beneficial owner-
ship interest in a partnership or trust, 
‘‘(C) except as provided in paragraph (2), 
any note, bond, debenture, or other evidence of 
indebtedness, and 
‘‘(D) any derivative (as defined in section 
4476). 
‘‘(2) EXCEPTION FOR CERTAIN TRADED SHORT- 
TERM INDEBTEDNESS.—A note, bond, debenture, or 
other evidence of indebtedness which— 
‘‘(A) is traded on, or is subject to the rules 
of, a qualified board or exchange located in the 
United States, and 
‘‘(B) has a fixed maturity of not more 
than 100 days, 
shall not be treated as described in paragraph 
(1)(C). 
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‘‘(3) QUALIFIED BOARD OR EXCHANGE.—The 
term ‘qualified board or exchange’ has the meaning 
given such term by section 1256(g)(7). 
‘‘(f) BY WHOM PAID.— 
‘‘(1) IN GENERAL.—The tax imposed by this 
section shall be paid by— 
‘‘(A) in the case of a transaction which oc-
curs on, or is subject to the rules of, a qualified 
board or exchange located in the United States, 
such qualified board or exchange, and 
‘‘(B) in the case of a purchase not de-
scribed in subparagraph (A) which is executed 
by a broker (as defined in section 6045(c)(1)) 
which is a United States person, such broker. 
‘‘(2) SPECIAL
RULES
FOR
DIRECT, 
ETC., 
TRANSACTIONS.—In the case of any transaction to 
which paragraph (1) does not apply, the tax imposed 
by this section shall be paid by— 
‘‘(A) in the case of a transaction described 
in subsection (d)(1)(A)— 
‘‘(i) the purchaser if the purchaser is 
a United States person, and 
‘‘(ii) the seller if the purchaser is not 
a United States person, and 
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‘‘(B) in the case of a transaction described 
in subsection (d)(1)(B)— 
‘‘(i) the payor if the payor is a United 
States person, and 
‘‘(ii) the payee if the payor is not a 
United States person. 
‘‘(g) TREATMENT OF EXCHANGES AND PAYMENTS 
WITH RESPECT TO DERIVATIVES.—For purposes of this 
section— 
‘‘(1) TREATMENT OF EXCHANGES.— 
‘‘(A) IN GENERAL.—An exchange shall be 
treated as the sale of the property transferred 
and a purchase of the property received by each 
party to the exchange. 
‘‘(B) CERTAIN DEEMED EXCHANGES.—In 
the case of a distribution treated as an ex-
change for stock under section 302 or 331, the 
corporation making such distribution shall be 
treated as having purchased such stock for pur-
poses of this section. 
‘‘(2) PAYMENTS
WITH
RESPECT
TO
DERIVA-
TIVES TREATED AS SEPARATE TRANSACTIONS.—Ex-
cept as otherwise provided by the Secretary, any 
payment with respect to any derivative shall be 
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treated as a separate transaction for purposes of 
this section. 
‘‘(h) APPLICATION
TO
TRANSACTIONS
BY
CON-
TROLLED FOREIGN CORPORATIONS.— 
‘‘(1) IN GENERAL.—For purposes of this sec-
tion, a controlled foreign corporation shall be treated 
as a United States person. 
‘‘(2) SPECIAL RULES FOR PAYMENT OF TAX ON 
DIRECT, ETC., TRANSACTIONS.—In the case of any 
transaction which is a covered transaction solely by 
reason of paragraph (1) and which is not described 
in subsection (f)(1)— 
‘‘(A) PAYMENT BY UNITED STATES SHARE-
HOLDERS.—Any tax which would (but for this 
paragraph) be payable under subsection (f)(2) 
by the controlled foreign corporation shall, in 
lieu thereof, be paid by the United States 
shareholders of such controlled foreign corpora-
tion as provided in subparagraph (B). 
‘‘(B) PRO
RATA
SHARES.—Each such 
United States shareholder shall pay the same 
proportion of such tax as— 
‘‘(i) the stock which such United 
States shareholder owns (within the mean-
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ing of section 958(a)) in such controlled 
foreign corporation, bears to 
‘‘(ii) the stock so owned by all United 
States shareholders in such controlled for-
eign corporation. 
‘‘(C) DEFINITIONS.—For purposes of this 
subsection, the terms ‘United States share-
holder’ and ‘controlled foreign corporation’ have 
the meanings given such terms in sections 
951(b) and 957(a), respectively. 
‘‘(i) ADMINISTRATION.—The Secretary shall carry 
out this section in consultation with the Securities and Ex-
change Commission and the Commodity Futures Trading 
Commission. 
‘‘(j) GUIDANCE; REGULATIONS.—The Secretary 
shall— 
‘‘(1) provide guidance regarding such informa-
tion reporting concerning covered transactions as the 
Secretary deems appropriate, and 
‘‘(2) prescribe such regulations as are necessary 
or appropriate to prevent avoidance of the purposes 
of this section, including the use of non-United 
States persons in such transactions. 
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‘‘SEC. 4476. DERIVATIVE DEFINED. 
‘‘(a) IN GENERAL.—For purposes of this subchapter, 
except as otherwise provided in this section, the term ‘de-
rivative’ means any contract (including any option, for-
ward contract, futures contract, short position, swap, or 
similar contract) the value of which, or any payment or 
other transfer with respect to which, is (directly or indi-
rectly) determined by reference to one or more of the fol-
lowing: 
‘‘(1) Any share of stock in a corporation. 
‘‘(2) Any partnership or beneficial ownership 
interest in a partnership or trust. 
‘‘(3) Any evidence of indebtedness. 
‘‘(4) Except as provided in subsection (b)(1), 
any real property. 
‘‘(5) Any commodity which is actively traded 
(within the meaning of section 1092(d)(1)). 
‘‘(6) Any currency. 
‘‘(7) Any rate, price, amount, index, formula, or 
algorithm. 
‘‘(8) Any other item as the Secretary may pre-
scribe. 
Except as provided in regulations prescribed by the Sec-
retary to prevent the avoidance of the purposes of this 
subchapter, such term shall not include any item described 
in paragraphs (1) through (8). 
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‘‘(b) EXCEPTIONS.— 
‘‘(1) CERTAIN REAL PROPERTY.— 
‘‘(A) IN GENERAL.—For purposes of this 
subchapter, the term ‘derivative’ shall not in-
clude any contract with respect to interests in 
real 
property 
(as 
defined 
in 
section 
856(c)(5)(C)) if such contract requires physical 
delivery of such real property. 
‘‘(B) OPTIONS TO SETTLE IN CASH.— 
‘‘(i) IN
GENERAL.—For purposes of 
subparagraph (A), a contract which pro-
vides for an option of cash settlement shall 
not be treated as requiring physical deliv-
ery of real property unless the option is— 
‘‘(I) not exercisable uncondition-
ally, and 
‘‘(II) exercisable only in unusual 
and exceptional circumstances. 
‘‘(ii) 
OPTION
OF
CASH
SETTLE-
MENT.—For purposes of clause (i), a con-
tract provides an option of cash settlement 
if the contract settles in (or could be set-
tled in) cash or property other than the 
underlying real property. 
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‘‘(2) SECURITIES LENDING, SALE-REPURCHASE, 
AND
SIMILAR
FINANCING
TRANSACTIONS.—To the 
extent provided by the Secretary, for purposes of 
this subchapter, the term ‘derivative’ shall not in-
clude the right to the return of the same or substan-
tially identical securities transferred in a securities 
lending transaction, sale-repurchase transaction, or 
similar financing transaction. 
‘‘(3) OPTIONS RECEIVED IN CONNECTION WITH 
THE PERFORMANCE OF SERVICES.—For purposes of 
this subchapter, the term ‘derivative’ shall not in-
clude any option described in section 83(e)(3) re-
ceived in connection with the performance of serv-
ices. 
‘‘(4) INSURANCE CONTRACTS, ANNUITIES, AND 
ENDOWMENTS.—For purposes of this subchapter, 
the term ‘derivative’ shall not include any insurance, 
annuity, or endowment contract issued by an insur-
ance company to which subchapter L applies (or 
issued by any foreign corporation to which such sub-
chapter would apply if such foreign corporation were 
a domestic corporation). 
‘‘(5) DERIVATIVES WITH RESPECT TO STOCK 
OF
MEMBERS
OF
SAME
WORLDWIDE
AFFILIATED 
GROUP.—For purposes of this subchapter, the term 
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‘derivative’ shall not include any derivative (deter-
mined without regard to this paragraph) with re-
spect to stock issued by any member of the same 
worldwide affiliated group (as defined in section 
864(f)) in which the taxpayer is a member. 
‘‘(6) COMMODITIES USED IN NORMAL COURSE 
OF TRADE OR BUSINESS.—For purposes of this sub-
chapter, the term ‘derivative’ shall not include any 
contract with respect to any commodity if— 
‘‘(A) such contract requires physical deliv-
ery with the option of cash settlement only in 
unusual and exceptional circumstances, and 
‘‘(B) such commodity is used (and is used 
in quantities with respect to which such deriva-
tive relates) in the normal course of the tax-
payer’s trade or business (or, in the case of an 
individual, for personal consumption). 
‘‘(c) CONTRACTS WITH EMBEDDED DERIVATIVE 
COMPONENTS.— 
‘‘(1) IN GENERAL.—If a contract has derivative 
and nonderivative components, then each derivative 
component shall be treated as a derivative for pur-
poses of this subchapter. If the derivative component 
cannot be separately valued, then the entire contract 
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shall be treated as a derivative for purposes of this 
subchapter. 
‘‘(2) EXCEPTION FOR CERTAIN EMBEDDED DE-
RIVATIVE COMPONENTS OF DEBT INSTRUMENTS.—A 
debt instrument shall not be treated as having a de-
rivative component merely because— 
‘‘(A) such debt instrument is denominated 
in a nonfunctional currency (as defined in sec-
tion 988(c)(1)(C)(ii)), or 
‘‘(B) payments with respect to such debt 
instrument are determined by reference to the 
value of a nonfunctional currency (as so de-
fined). 
‘‘(d) TREATMENT OF AMERICAN DEPOSITORY RE-
CEIPTS AND SIMILAR INSTRUMENTS.—Except as other-
wise provided by the Secretary, for purposes of this sub-
chapter, American depository receipts (and similar instru-
ments) with respect to shares of stock in foreign corpora-
tions shall be treated as shares of stock in such foreign 
corporations.’’. 
(b) INFORMATION REPORTING WITH RESPECT TO 
CONTROLLED
FOREIGN
CORPORATIONS.—Section 
6038(a)(1)(B) of such Code is amended by inserting ‘‘and 
transactions which are covered transactions for purposes 
of section 4475 by reason of the application of section 
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4475(h)(1) to such corporation’’ before the semicolon at 
the end. 
(c) CONFORMING AMENDMENT.—The table of sub-
chapters for chapter 36 of such Code is amended by in-
serting after the item relating to subchapter B the fol-
lowing new item: 
‘‘SUBCHAPTER C. TAX ON TRADING TRANSACTIONS’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to transactions after December 31, 
2024. 
Æ 
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