I 
110TH CONGRESS 
2D SESSION 
H. R. 7044 
To amend the Internal Revenue Code of 1986 to allow a temporary dividends 
received deduction for taxable years beginning in 2008 or 2009. 
IN THE HOUSE OF REPRESENTATIVES 
SEPTEMBER 24, 2008 
Mr. ENGLISH of Pennsylvania (for himself and Mr. BRADY of Texas) intro-
duced the following bill; which was referred to the Committee on Ways 
and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to allow a 
temporary dividends received deduction for taxable years 
beginning in 2008 or 2009. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. TEMPORARY DIVIDENDS RECEIVED DEDUC-
TION ALLOWED FOR 2008 OR 2009. 
(a) ELECTION.—Subsection (f) of section 965 of the 
Internal Revenue Code of 1986 (relating to election) is 
amended to read as follows: 
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‘‘(f) ELECTION.—In the case of any taxable year be-
ginning after September 30, 2007, the taxpayer may elect 
to apply this section to— 
‘‘(1) the taxpayer’s last taxable year which be-
gins before the date of the enactment of this sub-
section, or 
‘‘(2) the taxpayer’s first taxable year which be-
gins during the 1-year period beginning on such 
date. 
Such election may be made for a taxable year only if made 
on or before the due date (including extensions) for filing 
the return of tax for such taxable year.’’. 
(b) FAILURE TO MAINTAIN EMPLOYMENT LEV-
ELS.—Subsection (b) of section 965 of such Code (relating 
to limitations) is amended by adding at the end the fol-
lowing: 
‘‘(5) REDUCTION IN BENEFITS FOR FAILURE 
TO MAINTAIN EMPLOYMENT LEVELS.— 
‘‘(A) IN GENERAL.—If, during the period 
consisting of the calendar month in which the 
taxpayer first receives a distribution described 
in paragraph (1) and the succeeding 23 cal-
endar months, the taxpayer does not maintain 
an average employment level at least equal to 
the taxpayer’s prior average employment, an 
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additional amount equal to $25,000 multiplied 
by the number of employees by which the tax-
payers average employment level during such 
period falls below the prior average employment 
(but not exceeding the aggregate amount al-
lowed as a deduction pursuant to paragraph 
(1)) shall be taken into income by the taxpayer 
during the taxable year that includes the final 
day of such period. 
‘‘(B) PRIOR AVERAGE EMPLOYMENT.—For 
purposes of this paragraph, the taxpayer’s 
‘prior average employment’ shall be the average 
number of employees of the taxpayer during the 
period consisting of the 24 calendar months im-
mediately preceding the calendar month in 
which the taxpayer first receives a distribution 
described in paragraph (1). 
‘‘(C) AGGREGATION
RULES.—In deter-
mining the taxpayer’s average employment level 
and prior average employment, all domestic 
members of a controlled group shall be treated 
as a single taxpayer.’’. 
(c) THRESHOLD PERIOD.—Section 965 of such Code 
is amended by striking ‘‘June 30, 2003’’ each place it oc-
curs and inserting ‘‘June 30, 2007’’. 
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