SEC. 404. TAX ON INCOME DERIVED BY FOREIGN CORPORA-
TIONS FROM BUSINESS ACTIVITY WITH IRAN 
PROHIBITED BY UNITED STATES LAW. 
(a) TAX AMENDMENT.—Subpart B of part II of sub-
chapter N of chapter 1 of the Internal Revenue Code of 
1986 (relating to foreign corporations) is amended by in-
serting after section 884 the following new section: 
‘‘SEC. 884A. TAX ON INCOME DERIVED BY FOREIGN COR-
PORATIONS FROM BUSINESS ACTIVITY WITH 
IRAN PROHIBITED BY UNITED STATES LAW. 
‘‘In the case of a foreign corporation which is en-
gaged in business activity with Iran prohibited by United 
States law— 
‘‘(1) in respect of tax on income derived from 
such prohibited activity— 
‘‘(A) section 881(a) shall be applied by 
substituting ‘45 percent’ for ‘30 percent’; 
‘‘(B) subsections (b), (c), (d) and (e) of 
section 881 shall not apply; 
‘‘(C) tax imposed pursuant to section 882 
shall be imposed at a rate of ‘45 percent’; 
‘‘(D) section 883 shall not apply; and 
‘‘(E) section 884(a) shall be applied by 
substituting ‘45 percent’ for ‘30 percent’; and 
‘‘(2) in respect of withholding— 
VerDate Nov 24 2008 
03:00 Feb 28, 2009
Jkt 079200
PO 00000
Frm 00030
Fmt 6652
Sfmt 6201
E:\BILLS\H1208.IH
H1208
wwoods2 on PRODPC68 with BILLS
‘‘(A) section 1442(a) shall be applied by 
substituting ‘45 percent’ for ‘30 percent’; and 
‘‘(B) section 1442(c) shall not apply.’’. 
(b) CLERICAL AMENDMENT.—The table of sections 
for subpart B of part II of subchapter N of chapter 1 
of such Code is amended by inserting after the item relat-
ing to section 884 the following new item: 
‘‘Sec. 884A. Income tax of foreign corporations engaged in business activity 
with Iran prohibited by United States law.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
the date of the enactment of this Act. 
TITLE V—COMPENSATION FOR 
FORMER 
UNITED 
STATES 
HOSTAGES 
HELD 
BY 
IRAN 
AND VICTIMS OF IRANIAN- 
SPONSORED TERRORIST AT-
TACKS AGAINST THE UNITED 
STATES 
SEC. 501. CREATION OF FUND. 
There is established a fund to be known as the ‘‘Com-
pensation for Former United States Hostages in Iran 
Fund’’ (in this title referred to as the ‘‘Fund’’), consisting 
of such amounts as may be appropriated to the Fund as 
provided by this section. 
VerDate Nov 24 2008 
02:24 Feb 28, 2009
Jkt 079200
PO 00000
Frm 00031
Fmt 6652
Sfmt 6201
E:\BILLS\H1208.IH
H1208
wwoods2 on PRODPC68 with BILLS
SEC. 502. TRANSFERS TO FUND. 
There are hereby appropriated to the Fund amounts 
equivalent to the taxes received in the Treasury by reason 
of the amendments made by sections 403 and 404 of this 
Act. 
SEC. 503. EXPENDITURES FROM FUND. 
Amounts in the Fund shall be available, as provided 
by appropriation Acts, for making expenditures to pay 
claims to the United States citizens held hostage in Iran, 
and to members of the families of such United States citi-
zens, who are identified as plaintiffs or class members in 
Case Number 1:00CV03110 (EGS). 
SEC. 504. COMPENSATION AMOUNTS. 
Plaintiffs or class members referred to in section 503 
shall be compensated from amounts in the Fund as fol-
lows: 
(1) For each former hostage so identified as a 
plaintiff or class member, $1,000 for each day of 
captivity of such former hostage. 
(2) For each spouse and child so identified as 
a plaintiff or class member, $500 for each day of 
captivity of the hostage to whom such spouse or 
child is related. 
(3) Interest on each amount identified in ac-
cordance with paragraphs (1) and (2), calculated at 
the daily prime rate, as determined by the Board of 
VerDate Nov 24 2008 
02:24 Feb 28, 2009
Jkt 079200
PO 00000
Frm 00032
Fmt 6652
Sfmt 6201
E:\BILLS\H1208.IH
H1208
wwoods2 on PRODPC68 with BILLS
Governors of the Federal Reserve System, from the 
period beginning on the date on which a former hos-
tage so identified was taken hostage until the date 
of payment under this section. 
SEC. 505. REMAINING FUNDS. 
(a) IN GENERAL.—After all plaintiffs and class mem-
bers referred to in section 503 are compensated in accord-
ance with section 504, any amounts remaining in the 
Fund shall be distributed evenly among plaintiffs and 
class members who were granted judgments and awarded 
damages by United States courts in claims against Iran 
(identified in subsection (b)), but were not compensated. 
(b) CLAIMS IDENTIFIED.—Claims referred to in sub-
section (a) are the following: 
(1) Acosta v. Iran, 574 F. Supp. 2d 15 (D.D.C. 
2008). 
(2) Bakhtiar v. Islamic Republic of Iran, Civil 
Action No. 02–00092 (HHK) (D.D.C. 2008). 
(3) Beer v. Iran, 574 F. Supp. 2d 1 (D.D.C. 
2008). 
(4) Bennett v. Islamic Republic of Iran, 507 F. 
Supp. 2d 117 (D.D.C. 2007). 
(5) Ben-Rafael v. Islamic Republic of Iran, 
2008 WL 485091 (D.D.C. 2008). 
VerDate Nov 24 2008 
02:24 Feb 28, 2009
Jkt 079200
PO 00000
Frm 00033
Fmt 6652
Sfmt 6201
E:\BILLS\H1208.IH
H1208
wwoods2 on PRODPC68 with BILLS
(6) Blais v. Islamic Republic of Iran, 459 F. 
Supp. 2d 40 (D.D.C. 2006). 
(7) Bodoff v. Islamic Republic of Iran, 424 F. 
Supp. 2d 74 (D.D.C. 2006). 
(8) Campuzano v. Islamic Republic of Iran, 281 
F. Supp. 2d 258 (D.D.C. 2003). 
(9) Cicippio-Puleo v. Islamic Republic of Iran, 
Civil Action No. 01–01496 (HHK) (D.D.C. 2005). 
(10) Cronin v. Islamic Republic of Iran, 238 F. 
Supp. 2d 222 (D.D.C. 2002). 
(11) Dammarell v. Islamic Republic of Iran, 
2006 WL 2583043 (D.D.C 2006). 
(12) Dodge v. Islamic Republic of Iran, 2004 
WL 5353873 (D.D.C. 2004). 
(13) Estate of Heiser v. Islamic Republic of 
Iran, 466 F. Supp. 2d 229 (D.D.C. 2006). 
(14) Estate of Bayani v. Islamic Republic of 
Iran, Civil Action No. 04–01712 (HHK), 2007 WL 
4116167 (D.D.C. 2007). 
(15) Greenbaum v. Islamic Republic of Iran, 
451 F. Supp. 2d 90 (D.D.C 2006). 
(16) Haim v. Islamic Republic of Iran, 425 F. 
Supp. 2d 56 (D.D.C 2006). 
(17) Holland v. Islamic Republic of Iran, 496 
F. Supp. 2d 1 (D.D.C. 2005). 
VerDate Nov 24 2008 
02:24 Feb 28, 2009
Jkt 079200
PO 00000
Frm 00034
Fmt 6652
Sfmt 6201
E:\BILLS\H1208.IH
H1208
wwoods2 on PRODPC68 with BILLS