I 
110TH CONGRESS 
2D SESSION 
H. R. 7305 
To immediately terminate the authority of the Secretary of the Treasury 
under the Emergency Economic Stabilization Act of 2008 to purchase 
troubled assets, to require the Secretary to make insurance of troubled 
mortgage-backed securities available for purchase, and to provide incen-
tives to reinvest foreign earnings in the United States, and for other 
purposes. 
IN THE HOUSE OF REPRESENTATIVES 
NOVEMBER 20, 2008 
Mr. GOHMERT introduced the following bill; which was referred to the Com-
mittee on Financial Services, and in addition to the Committee on Ways 
and Means, 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 immediately terminate the authority of the Secretary 
of the Treasury under the Emergency Economic Sta-
bilization Act of 2008 to purchase troubled assets, to 
require the Secretary to make insurance of troubled 
mortgage-backed securities available for purchase, and 
to provide incentives to reinvest foreign earnings in the 
United States, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
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SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Responsibly Ending 
Authority to Purchase Act of 2008’’ or the ‘‘REAP Act 
of 2008’’. 
SEC. 2. TERMINATION OF PURCHASE AUTHORITY. 
(a) IN GENERAL.—The authorities provided under 
section 101(a) of the Emergency Economic Stabilization 
Act of 2008 (Public Law 110–343), excluding section 
101(a)(3) of such Act, shall terminate immediately upon 
the enactment of this Act. 
(b) RULE
OF
CONSTRUCTION.—The termination 
under subsection (a) shall apply to any authority of the 
Secretary of the Treasury under the Emergency Economic 
Stabilization Act of 2008 to purchase preferred or other 
stock or equity in any financial institution. 
(c) CONFORMING
AMENDMENT.—The Emergency 
Economic Stabilization Act of 2008 is amended by strik-
ing section 120. 
SEC. 3. IMPLEMENTATION OF PROGRAM FOR INSURANCE 
OF TROUBLED MORTGAGE-BACKED SECURI-
TIES. 
(a) IN GENERAL.—Section 102 of the Emergency 
Economic Stabilization Act of 2008 (Public Law 110– 
343) is amended— 
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(1) in the section heading, by striking ‘‘AS-
SETS’’ and inserting ‘‘MORTGAGE-BACKED SECU-
RITIES’’; 
(2) by striking ‘‘troubled asset’’ and ‘‘troubled 
assets’’ each place such terms appear and inserting 
‘‘troubled asset’’ and ‘‘troubled mortgage-backed se-
curities’’, respectively; 
(3) in subsection (a)— 
(A) in paragraph (1)— 
(i) by striking ‘‘If the Secretary estab-
lished the program authorized under sec-
tion 101, then the Secretary shall estab-
lish’’ and inserting ‘‘Not later than the ex-
piration of the 60-day period beginning 
upon the date of the enactment of the Re-
sponsibly Ending Authority to Purchase 
Act of 2008, the Secretary shall establish 
and implement’’; and 
(ii) by striking ‘‘, including mortgage- 
backed securities’’; 
(B) in the first sentence of paragraph (2), 
by striking ‘‘may’’ and inserting ‘‘shall’’; and 
(C) in the first sentence of paragraph (3), 
by striking ‘‘may’’ and inserting ‘‘shall, subject 
to compliance by such financial institution with 
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any terms and conditions established by the 
Secretary,’’; 
(4) in subsection (c)(4), by striking ‘‘Troubled 
Assets’’ and inserting ‘‘Troubled Mortgage-Backed 
Securities’’; 
(5) in subsection (d)— 
(A) in the subsection heading, by striking 
‘‘TROUBLED ASSETS’’ and inserting ‘‘TROU-
BLED MORTGAGE-BACKED SECURITIES’’; and 
(B) in paragraph (1), by striking ‘‘Trou-
bled Assets’’ and inserting ‘‘Troubled Mort-
gage-Backed Securities’’; and 
(6) by adding at the end the following new sub-
section: 
‘‘(e) TERMINATION.— 
‘‘(1) IN GENERAL.—The authority of the Sec-
retary to issue guarantees and commitments for 
guarantees under this section shall terminate on De-
cember 31, 2009. 
‘‘(2) EXTENSION
UPON
CERTIFICATION.—The 
Secretary, upon submission of a written certification 
to Congress, may extend the authority specified in 
paragraph (1) to expire not later than 2 years from 
the date of enactment of this Act. Such certification 
shall include a justification of why the extension is 
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necessary to assist American families and stabilize 
financial markets, as well as the expected cost to the 
taxpayers for such an extension.’’. 
(b) DEFINITION.—Section 3 of the Emergency Eco-
nomic Stabilization Act of 2008 (Public Law 110–343) is 
amended by adding at the end the following new para-
graph: 
‘‘(10) TROUBLED
MORTGAGE-BACKED
SECU-
RITY.—The term ‘troubled mortgage-backed secu-
rity’ means a residential or commercial mortgage or 
any security, obligation, or other instrument that is 
based on or related to such mortgages, that in each 
case was originated or issued on or before March 14, 
2008.’’. 
(c) LIMITATIONS
ON GUARANTEE AUTHORITY.— 
Paragraph (4) of subsection (c) of section 102 of the 
Emergency Economic Stabilization Act of 2008 (Public 
Law 110–343) is amended to read as follows: 
‘‘(4) LIMITATIONS
ON
GUARANTEE
AUTHOR-
ITY.—The difference between the aggregate amount 
of outstanding obligations guaranteed under this 
section and the balance in the Troubled Mortgage- 
Backed Securities Insurance Financing Fund may 
not at any time exceed the remaining purchase au-
thority limit under section 115 at such time.’’. 
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SEC. 4. INCENTIVES TO REINVEST FOREIGN EARNINGS IN 
UNITED STATES. 
(a) IN GENERAL.—Section 965 of the Internal Rev-
enue Code of 1986 is amended to read as follows: 
‘‘SEC. 965. DEDUCTION FOR DIVIDENDS RECEIVED. 
‘‘(a) DEDUCTION.— 
‘‘(1) IN GENERAL.—In the case of a corpora-
tion which is a United States shareholder and for 
which the election under this section is in effect for 
the taxable year, there shall be allowed as a deduc-
tion an amount equal to the applicable percentage of 
cash dividends which are received during such tax-
able year by such shareholder from controlled for-
eign corporations. 
‘‘(2) APPLICABLE PERCENTAGE.—For purposes 
of paragraph (1)— 
‘‘(A) IN GENERAL.—Except as provided by 
subparagraph (B), the term ‘applicable percent-
age’ means 85 percent. 
‘‘(B) DISTRESSED DEBT.—In the case of 
dividends received with respect to which the re-
quirements of subsection (b)(4)(B) are met, 
such term means 100 percent. 
‘‘(3) DIVIDENDS PAID INDIRECTLY FROM CON-
TROLLED FOREIGN CORPORATIONS.—If, within the 
taxable year for which the election under this section 
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is in effect, a United States shareholder receives a 
cash distribution from a controlled foreign corpora-
tion which is excluded from gross income under sec-
tion 959(a), such distribution shall be treated for 
purposes of this section as a cash dividend to the ex-
tent of any amount included in income by such 
United 
States 
shareholder 
under 
section 
951(a)(1)(A) as a result of any cash dividend during 
such taxable year to— 
‘‘(A) such controlled foreign corporation 
from another controlled foreign corporation that 
is in a chain of ownership described in section 
958(a), or 
‘‘(B) any other controlled foreign corpora-
tion in such chain of ownership, but only to the 
extent of cash distributions described in section 
959(b) which are made during such taxable 
year to the controlled foreign corporation from 
which such United States shareholder received 
such distribution. 
‘‘(b) LIMITATIONS.— 
‘‘(1) IN GENERAL.—The amount of dividends 
taken into account under subsection (a) shall not ex-
ceed the greater of— 
‘‘(A) $500,000,000, 
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‘‘(4) REQUIREMENTS.— 
‘‘(A) REQUIREMENT TO INVEST IN UNITED 
STATES.—Except as provided by subparagraph 
(B), subsection (a) shall not apply to any divi-
dend received by a United States shareholder 
unless the amount of the dividend is invested in 
the United States pursuant to a domestic rein-
vestment plan which— 
‘‘(i) is approved by the taxpayer’s 
president, chief executive officer, or com-
parable official before the payment of such 
dividend and subsequently approved by the 
taxpayer’s board of directors, management 
committee, executive committee, or similar 
body, and 
‘‘(ii) provides for the reinvestment of 
such dividend in the United States (other 
than as payment for executive compensa-
tion), including as a source for the funding 
of worker hiring and training, infrastruc-
ture, research and development, capital in-
vestments, or the financial stabilization of 
the corporation for the purposes of job re-
tention or creation. 
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‘‘(B) DISTRESSED
DEBT.—The require-
ments of this subparagraph are met if amounts 
repatriated are invested in distressed debt (as 
defined by the Secretary) for at least one year. 
‘‘(c) DEFINITIONS AND SPECIAL RULES.—For pur-
poses of this section— 
‘‘(1) APPLICABLE
FINANCIAL
STATEMENT.— 
The term ‘applicable financial statement’ means— 
‘‘(A) with respect to a United States 
shareholder which is required to file a financial 
statement with the Securities and Exchange 
Commission (or which is included in such a 
statement so filed by another person), the most 
recent audited annual financial statement (in-
cluding the notes which form an integral part 
of such statement) of such shareholder (or 
which includes such shareholder)— 
‘‘(i) which was so filed on or before 
June 30, 2007, and 
‘‘(ii) which was certified on or before 
June 30, 2007, as being prepared in ac-
cordance with generally accepted account-
ing principles, and 
‘‘(B) with respect to any other United 
States shareholder, the most recent audited fi-
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nancial statement (including the notes which 
form an integral part of such statement) of 
such shareholder (or which includes such share-
holder)— 
‘‘(i) which was certified on or before 
June 30, 2007, as being prepared in ac-
cordance with generally accepted account-
ing principles, and 
‘‘(ii) which is used for the purposes of 
a statement or report— 
‘‘(I) to creditors, 
‘‘(II) to shareholders, or 
‘‘(III) for any other substantial 
nontax purpose. 
‘‘(2) BASE PERIOD YEAR.— 
‘‘(A) IN GENERAL.—The base period year 
is the first taxable year ending in 2007. 
‘‘(B) MERGERS, ACQUISITIONS, ETC.— 
‘‘(i) IN
GENERAL.—Rules similar to 
the rules of subparagraphs (A) and (B) of 
section 41(f)(3) shall apply for purposes of 
this paragraph. 
‘‘(ii) SPIN-OFFS, ETC.—If there is a 
distribution to which section 355 (or so 
much of section 356 as relates to section 
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355) applies during the base period year 
and the controlled corporation (within the 
meaning of section 355) is a United States 
shareholder— 
‘‘(I) the controlled corporation 
shall be treated as being in existence 
during the period that the distributing 
corporation (within the meaning of 
section 355) is in existence, and 
‘‘(II) for purposes of applying 
subsection (b)(2) to the controlled cor-
poration and the distributing corpora-
tion, amounts described in subsection 
(b)(2)(B) which are received or in-
cludible by the distributing corpora-
tion or controlled corporation (as the 
case may be) before the distribution 
referred to in subclause (I) from a 
controlled foreign corporation shall be 
allocated between such corporations in 
proportion to their respective interests 
as United States shareholders of such 
controlled foreign corporation imme-
diately after such distribution. 
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Subclause (II) shall not apply if neither 
the controlled corporation nor the distrib-
uting corporation is a United States share-
holder of such controlled foreign corpora-
tion immediately after such distribution. 
‘‘(3) DIVIDEND.—The term ‘dividend’ shall not 
include amounts includible in gross income as a divi-
dend under section 78, 367, or 1248. In the case of 
a liquidation under section 332 to which section 
367(b) applies, the preceding sentence shall not 
apply to the extent the United States shareholder 
actually receives cash as part of the liquidation. 
‘‘(4) COORDINATION
WITH
DIVIDENDS
RE-
CEIVED DEDUCTION.—No deduction shall be allowed 
under section 243 or 245 for any dividend for which 
a deduction is allowed under this section. 
‘‘(5) CONTROLLED GROUPS.— 
‘‘(A) IN
GENERAL.—All United States 
shareholders which are members of an affiliated 
group filing a consolidated return under section 
1501 shall be treated as one United States 
shareholder. 
‘‘(B) 
APPLICATION
OF
$500,000,000 
LIMIT.—All corporations which are treated as a 
single employer under section 52(a) shall be 
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limited to one $500,000,000 amount in sub-
section (b)(1)(A), and such amount shall be di-
vided among such corporations under regula-
tions prescribed by the Secretary. 
‘‘(C) PERMANENTLY
REINVESTED
EARN-
INGS.—If a financial statement is an applicable 
financial statement for more than 1 United 
States shareholder, the amount applicable 
under subparagraph (B) or (C) of subsection 
(b)(1) shall be divided among such shareholders 
under regulations prescribed by the Secretary. 
‘‘(d) DENIAL OF FOREIGN TAX CREDIT; DENIAL OF 
CERTAIN EXPENSES.— 
‘‘(1) FOREIGN TAX CREDIT.—No credit shall be 
allowed under section 901 for any taxes paid or ac-
crued (or treated as paid or accrued) with respect to 
the deductible portion of— 
‘‘(A) any dividend, or 
‘‘(B) any amount described in subsection 
(a)(2) which is included in income under section 
951(a)(1)(A). 
No deduction shall be allowed under this chapter for 
any tax for which credit is not allowable by reason 
of the preceding sentence. 
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