I 
112TH CONGRESS 
1ST SESSION H. R. 1031 
To amend the Internal Revenue Code of 1986 to repeal the shipping invest-
ment withdrawal rules in section 955 and to provide an incentive to 
reinvest foreign shipping earnings in the United States. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 11, 2011 
Mr. TIBERI (for himself and Mr. MCDERMOTT) introduced the following bill; 
which was referred to the Committee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to repeal 
the shipping investment withdrawal rules in section 955 
and to provide an incentive to reinvest foreign shipping 
earnings in the United States. 
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 Shipping Re-
investment Act of 2011’’. 
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amended by striking the item relating to section 
955. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years of controlled for-
eign corporations ending on or after the date of the enact-
ment of this Act, and to taxable years of United States 
shareholders in which or with which such taxable years 
of controlled foreign corporations end. 
SEC. 3. ONE-TIME TEMPORARY DIVIDENDS RECEIVED DE-
DUCTION FOR PREVIOUSLY UNTAXED FOR-
EIGN BASE COMPANY SHIPPING INCOME. 
(a) IN GENERAL.—In the case of a corporation which 
is a United States shareholder and for which an election 
under this section is made for the taxable year, for pur-
poses of the Internal Revenue Code of 1986, there shall 
be allowed as a deduction in computing taxable income 
under section 63 of such Code an amount equal to 85 per-
cent of the cash distributions which are received during 
such taxable year by such shareholder from controlled for-
eign corporations to the extent that the distributions are 
attributable to income— 
(1) which was derived by the controlled foreign 
corporation in taxable years beginning before Janu-
ary 1, 2005, and 
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(2) which would, without regard to the year 
earned, be described in section 954(f) of such Code 
(as in effect before the enactment of the American 
Jobs Creation Act of 2004). 
(b) INDIRECT DIVIDENDS.—A rule similar to the rule 
of section 965(a)(2) of the Internal Revenue Code of 1986 
shall apply, determined by treating cash distributions 
which are so attributable as cash dividends. 
(c) LIMITATION.—The amount of dividends taken 
into account under this section shall not exceed the 
amount permitted to be taken into account under para-
graphs (1), (3) (determined by substituting ‘‘December 
31, 2008’’ for ‘‘October 3, 2004’’), and (4) of section 
965(b) of the Internal Revenue Code of 1986, determined 
as if such paragraphs applied to this section. 
(d) TAXPAYER ELECTION AND DESIGNATION.—For 
purposes of subsection (a), a taxpayer may, on its return 
for the taxable year to which this section applies— 
(1) elect to apply paragraph (3) of section 
959(c) of the Internal Revenue Code of 1986 before 
paragraphs (1) and (2) thereof, and 
(2) designate the extent, if any, to which a cash 
distribution reduces a controlled foreign corpora-
tion’s earnings and profits attributable to— 
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(A) foreign base company shipping income 
(determined under section 954(f) of the Inter-
nal Revenue Code of 1986 as in effect before 
the enactment of the American Jobs Creation 
Act of 2004), or 
(B) other earnings and profits. 
(e) ELECTION.— 
(1) IN GENERAL.—The taxpayer may elect to 
apply this section to— 
(A) the taxpayer’s last taxable year which 
begins before the date of the enactment of this 
Act, or 
(B) the taxpayer’s first taxable year which 
begins during the 1-year period beginning on 
such date. 
(2) TIMING OF ELECTION AND ONE-TIME ELEC-
TION.—Such election may be made for a taxable 
year— 
(A) only if made on or before the due date 
(including extensions) for filing the return of 
tax for such taxable year, and 
(B) only if no election has been made 
under this section or section 965 of the Internal 
Revenue Code of 1986 with respect to the same 
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distribution for any other taxable year of the 
taxpayer. 
(f) REDUCTION
IN BENEFITS
FOR FAILURE TO 
MAINTAIN EMPLOYMENT LEVELS.— 
(1) IN GENERAL.—If, during the period con-
sisting of the calendar month in which the taxpayer 
first receives a distribution described in subsection 
(a) and the succeeding 23 calendar months, the tax-
payer does not maintain an average employment 
level at least equal to the taxpayer’s prior average 
employment, an additional amount equal to $25,000 
multiplied by the number of employees by which the 
taxpayer’s average employment level during such pe-
riod falls below the prior average employment (but 
not exceeding the aggregate amount allowed as a de-
duction pursuant to subsection (a)) shall be taken 
into account as income by the taxpayer during the 
taxable year that includes the final day of such pe-
riod. 
(2) PRIOR AVERAGE EMPLOYMENT.—For pur-
poses of this paragraph, the taxpayer’s ‘‘prior aver-
age employment’’ shall be the average number of 
full-time equivalent employees of the taxpayer during 
the period consisting of the 24 calendar months im-
mediately preceding the calendar month in which the 
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taxpayer first receives a distribution described in 
subsection (a). 
(3) AGGREGATION RULES.—In determining the 
taxpayer’s average employment level and prior aver-
age employment, all domestic members of a con-
trolled group (as defined in section 264(e)(5)(B) of 
the Internal Revenue Code of 1986) shall be treated 
as a single taxpayer. 
(g) SPECIAL RULES.—Rules similar to the rules of 
subsections (d) and (e) and paragraphs (3), (4), and (5) 
of subsection (c) of section 965 of the Internal Revenue 
Code of 1986 shall apply for purposes of this section. 
(h) EFFECTIVE DATE.—This section shall apply to 
taxable years ending on or after the date of the enactment 
of this Act. 
Æ 
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