I 
114TH CONGRESS 
1ST SESSION H. R. 1305 
To amend the Internal Revenue Code of 1986 to limit the deductibility 
of excessive rates of executive compensation. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 4, 2015 
Ms. LEE (for herself, Mr. CONYERS, Mr. ELLISON, Ms. SCHAKOWSKY, and 
Mr. POCAN) introduced the following bill; which was referred to the Com-
mittee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to limit the 
deductibility of excessive rates of executive compensation. 
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 ‘‘Income Equity Act 
of 2015’’. 
SEC. 2. DENIAL OF DEDUCTION FOR PAYMENTS OF EXCES-
SIVE COMPENSATION. 
(a) IN GENERAL.—Section 162 of the Internal Rev-
enue Code of 1986 is amended by inserting after sub-
section (h) the following new subsection: 
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‘‘(i) EXCESSIVE COMPENSATION.— 
‘‘(1) IN GENERAL.—No deduction shall be al-
lowed under this chapter for any excessive com-
pensation with respect to any full-time employee. 
‘‘(2) EXCESSIVE
COMPENSATION.—For pur-
poses of this subsection, the term ‘excessive com-
pensation’ means, with respect to any employee, the 
amount by which— 
‘‘(A) the compensation for services per-
formed by such employee during the taxable 
year, exceeds 
‘‘(B) the greater of— 
‘‘(i) an amount equal to 25 times the 
median compensation paid by the employer 
for services performed by full-time employ-
ees during such taxable year, or 
‘‘(ii) $500,000. 
‘‘(3) DEFINITIONS AND SPECIAL RULES.—For 
purposes of this subsection— 
‘‘(A) COMPENSATION.— 
‘‘(i) IN
GENERAL.—The term ‘com-
pensation’ includes wages, salary, deferred 
compensation, 
retirement 
contributions, 
options, bonuses, property, and any other 
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form of compensation or bonus that the 
Secretary determines is appropriate. 
‘‘(ii) PART-YEAR EMPLOYEES.—In the 
case of any part-year employee, the com-
pensation of the employee shall be com-
puted on an annualized basis. 
‘‘(B) EMPLOYER.—All persons treated as a 
single employer under subsection (a) or (b) of 
section 52 or subsection (m) or (o) of section 
414 shall be treated as 1 employer. 
‘‘(4) REPORTING.—Each employer who provides 
compensation in any taxable year to any employee in 
an amount which is more than the amount described 
in paragraph (2)(B)(i) with respect to the employer 
for the taxable year, shall file a report with the Sec-
retary containing— 
‘‘(A) the amount described in paragraph 
(2)(B)(i) with respect to the employer for the 
taxable year, 
‘‘(B) the average pay of all non-managerial 
employees, 
‘‘(C) the average pay of all executive staff, 
and 
‘‘(D) the compensation of the top 5 em-
ployees of the company. 
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Any such report shall be filed at such time and in 
such manner as the Secretary may require.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
the date of the enactment of this Act. 
Æ 
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