I 
116TH CONGRESS 
2D SESSION 
H. R. 7309 
To prohibit certain assistance for inverted domestic corporations. 
IN THE HOUSE OF REPRESENTATIVES 
JUNE 24, 2020 
Mr. DOGGETT introduced the following bill; which was referred to the Com-
mittee on Ways and Means, and in addition to the Committee on Finan-
cial Services, for a period to be subsequently determined by the Speaker, 
in each case for consideration of such provisions as fall within the juris-
diction of the committee concerned 
A BILL 
To prohibit certain assistance for inverted domestic 
corporations. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘American Assistance 
for American Companies Act’’. 
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SEC. 2. PROHIBITION ON APPLICATION OF CERTAIN AS-
SISTANCE TO INVERTED DOMESTIC COR-
PORATIONS. 
(a) PROHIBITION ON USE OF CERTAIN TAX INCEN-
TIVES.— 
(1) NET OPERATING LOSS CARRYBACKS.— 
(A) IN
GENERAL.—Section 172(b)(1)(D) 
of the Internal Revenue Code of 1986 is 
amended by adding at the end the following 
new clause: 
‘‘(vi) SPECIAL RULE FOR INVERTED 
DOMESTIC
CORPORATIONS.—Clause 
(i) 
shall not apply to any foreign corporation 
for any taxable year in which such corpora-
tion is an inverted domestic corporation 
(as defined in section 7701(p)(2)), or to 
any member of the expanded affiliated 
group (as defined in section 7874(c)(1)) of 
such a foreign corporation, unless such for-
eign corporation has made an election 
under section 7701(p)(1).’’. 
(B) EFFECTIVE
DATE.—The amendment 
made by this section shall take effect as if in-
cluded in section 2303(b) of the CARES Act. 
(2) INCREASED LIMITATION ON BUSINESS IN-
TEREST.— 
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(A) IN GENERAL.—Section 163(j)(10) of 
the Internal Revenue Code of 1986 is amended 
by adding at the end the following new sub-
paragraph: 
‘‘(C) SPECIAL RULE FOR INVERTED DO-
MESTIC
CORPORATIONS.—Subparagraphs (A) 
and (B) shall not apply to any foreign corpora-
tion for any taxable year in which such corpora-
tion is an inverted domestic corporation (as de-
fined in section 7701(p)(2)), or to any member 
of the expanded affiliated group (as defined in 
section 7874(c)(1)) of such a foreign corpora-
tion, unless such foreign corporation has made 
an election under section 7701(p)(1).’’. 
(B) EFFECTIVE
DATE.—The amendment 
made by this section shall take effect as if in-
cluded in section 2306 of the CARES Act. 
(3) FEDERAL RESERVE EMERGENCY LENDING 
FACILITIES.— 
(A) IN GENERAL.—No inverted domestic 
corporation, as defined in section 7701(p)(2) of 
the Internal Revenue Code of 1986, or any 
member of the expanded affiliated group (as de-
fined in section 7874(c)(1) of such Code) of 
such inverted domestic corporation, may partici-
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pate in any program or facility established by 
the Board of Governors of the Federal Reserve 
System under the authority of section 13(3) of 
the Federal Reserve Act (12 U.S.C. 343) and 
with funding authorized under section 4003 of 
the CARES Act (Public Law 116–136), includ-
ing the Primary Market Corporate Credit Facil-
ity and the Secondary Market Corporate Credit 
Facility. 
(B) EXCEPTION.—Subparagraph (A) shall 
not apply if the inverted domestic corporation 
makes an election under section 7701(p)(1) of 
the Internal Revenue Code of 1986. 
(C) APPLICABILITY.—This paragraph shall 
apply to participation in any program or facility 
described in subparagraph (A) established be-
fore, on, or after the date of enactment of this 
Act. 
(b) ELECTION TO TREAT INVERTED DOMESTIC COR-
PORATIONS AS DOMESTIC CORPORATIONS.— 
(1) INVERTED DOMESTIC CORPORATIONS.—Sec-
tion 7701 of the Internal Revenue Code of 1986 is 
amended by redesignating subsection (p) as sub-
section (q) and by inserting after subsection (o) the 
following new subsection: 
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‘‘(p) INVERTED DOMESTIC CORPORATIONS.— 
‘‘(1) ELECTION TO BE TREATED AS A DOMES-
TIC CORPORATION.— 
‘‘(A) IN GENERAL.—Notwithstanding pa-
ragraphs (4) and (5) of subsection (a), an in-
verted domestic corporation may elect to be 
treated as a domestic corporation for taxable 
years beginning with the last taxable year which 
begins before January 1, 2018. 
‘‘(B) ELECTION.—An election under this 
subsection— 
‘‘(i) shall be made not later than 30 
days after the date of the enactment of 
this subsection, and 
‘‘(ii) once made, shall be irrevocable. 
‘‘(C) TIME FOR FILING RETURNS AND PAY-
MENT
OF
TAXES.—Notwithstanding sections 
6072 and 6151, any return for any taxable year 
ending before the date described in subpara-
graph (B)(i), and any payment of taxes or pen-
alties, shall not be considered due before Janu-
ary 1, 2021. 
‘‘(2) INVERTED DOMESTIC CORPORATION.—For 
purposes of this subsection, the term ‘inverted do-
mestic corporation’ means any foreign corporation 
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ing a capital or profits interest in the 
domestic partnership, or 
‘‘(ii) the management and control of 
the expanded affiliated group which in-
cludes the corporation occurs, directly or 
indirectly, primarily within the United 
States, and such expanded affiliated group 
has significant domestic business activities. 
‘‘(3) EXCEPTION
FOR
CORPORATIONS
WITH 
SUBSTANTIAL
BUSINESS
ACTIVITIES
IN
FOREIGN 
COUNTRY OF ORGANIZATION.—Such term shall not 
include a foreign corporation described in paragraph 
(2) if after the acquisition the expanded affiliated 
group which includes the corporation has substantial 
business activities in the foreign country in which or 
under the law of which the corporation is created or 
organized when compared to the total business ac-
tivities of such expanded affiliated group. For pur-
poses of the preceding sentence, the term ‘substan-
tial business activities’ shall have the meaning given 
such term under regulations in effect on January 
18, 2017, except that the Secretary may issue regu-
lations increasing the threshold percent in any of the 
tests under such regulations for determining if busi-
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ness activities constitute substantial business activi-
ties for purposes of this paragraph. 
‘‘(4) MANAGEMENT AND CONTROL.—For pur-
poses of paragraph (2)(B)(ii)— 
‘‘(A) IN
GENERAL.—The Secretary shall 
prescribe regulations for purposes of deter-
mining cases in which the management and 
control of an expanded affiliated group is to be 
treated as occurring, directly or indirectly, pri-
marily within the United States. The regula-
tions prescribed under the preceding sentence 
shall apply to periods after March 4, 2003. 
‘‘(B) EXECUTIVE OFFICERS AND SENIOR 
MANAGEMENT.—Such regulations shall provide 
that the management and control of an ex-
panded affiliated group shall be treated as oc-
curring, directly or indirectly, primarily within 
the United States if substantially all of the ex-
ecutive officers and senior management of the 
expanded affiliated group who exercise day-to- 
day responsibility for making decisions involving 
strategic, financial, and operational policies of 
the expanded affiliated group are based or pri-
marily located within the United States. Indi-
viduals who in fact exercise such day-to-day re-
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sponsibilities shall be treated as executive offi-
cers and senior management regardless of their 
title. 
‘‘(5) SIGNIFICANT DOMESTIC BUSINESS ACTIVI-
TIES.—For purposes of paragraph (2)(B)(ii), an ex-
panded affiliated group has significant domestic 
business activities if at least 25 percent of— 
‘‘(A) the employees of the group are based 
in the United States, 
‘‘(B) the employee compensation incurred 
by the group is incurred with respect to employ-
ees based in the United States, 
‘‘(C) the assets of the group are located in 
the United States, or 
‘‘(D) the income of the group is derived in 
the United States, 
determined in the same manner as such determina-
tions are made for purposes of determining substan-
tial business activities under regulations referred to 
in paragraph (3) as in effect on January 18, 2017, 
but applied by treating all references in such regula-
tions to ‘foreign country’ and ‘relevant foreign coun-
try’ as references to ‘the United States’. The Sec-
retary may issue regulations decreasing the thresh-
old percent in any of the tests under such regula-
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tions for determining if business activities constitute 
significant domestic business activities for purposes 
of this paragraph. 
‘‘(6) DEFINITIONS AND OTHER RULES.— 
‘‘(A) EXPANDED
AFFILIATED
GROUP.— 
The term ‘expanded affiliated group’ has the 
meaning 
give 
such 
term 
under 
section 
7874(c)(1). 
‘‘(B) OTHER RULES.—Rules similar to the 
rules of paragraphs (2), (3), (5), and (6) of sec-
tion 7874(c) shall apply for purposes of this 
subsection.’’. 
Æ 
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