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HR 1 PCS 
(B) (as so redesignated) the following new sub-
paragraph: 
‘‘(A) any amount includible in gross in-
come under section 951A,’’. 
(B) NO CARRYOVER OF EXCESS TAXES.— 
Section 904(c) is amended by adding at the end 
the following: ‘‘This subsection shall not apply 
to taxes paid or accrued with respect to 
amounts described in subsection (d)(1)(A).’’ 
(3) GROSS UP FOR DEEMED PAID FOREIGN TAX 
CREDIT.—Section 78, as amended by the preceding 
provisions of this Act, is amended— 
(A) by striking ‘‘any taxable year, an 
amount’’ and inserting ‘‘any taxable year— 
‘‘(1) an amount’’, and 
(B) by striking the period at the end and 
inserting ‘‘, and 
‘‘(2) an amount equal to the taxes deemed to 
be paid by such corporation under section 960(d) for 
such taxable year (determined by substituting ‘100 
percent’ for ‘80 percent’ in such section) shall be 
treated for purposes of this title (other than sections 
959, 960, and 961) as an increase in the foreign 
high return amount of such domestic corporation 
under section 951A for such taxable year.’’. 
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(c) CONFORMING AMENDMENTS.— 
(1) Section 170(b)(2)(D) is amended by strik-
ing ‘‘computed without regard to’’ and all that fol-
lows and inserting ‘‘computed— 
‘‘(i) without regard to— 
‘‘(I) this section, 
‘‘(II) part VIII (except section 
248), 
‘‘(III) any net operating loss 
carryback to the taxable year under 
section 172, 
‘‘(IV) any capital loss carryback 
to the taxable year under section 
1212(a)(1), and 
‘‘(ii) by substituting ‘100 percent’ for 
‘50 percent’ in section 951A(a).’’. 
(2) Section 246(b)(1) is amended by— 
(A) striking ‘‘and without regard to’’ and 
inserting ‘‘without regard to’’, and 
(B) by striking the period at the end and 
inserting ‘‘, and by substituting ‘100 percent’ 
for ‘50 percent’ in section 951A(a).’’. 
(3) Section 469(i)(3)(F) is amended by striking 
‘‘determined without regard to’’ and all that follows 
and inserting ‘‘determined— 
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‘‘(i) without regard to— 
‘‘(I) any amount includible in 
gross income under section 86, 
‘‘(II) the amounts allowable as a 
deduction under section 219, and 
‘‘(III) any passive activity loss or 
any loss allowable by reason of sub-
section (c)(7), and 
‘‘(ii) by substituting ‘100 percent’ for 
‘50 percent’ in section 951A(a).’’. 
(4) Section 856(c)(2) is amended by striking 
‘‘and’’ at the end of subparagraph (H), by adding 
‘‘and’’ at the end of subparagraph (I), and by insert-
ing after subparagraph (I) the following new sub-
paragraph: 
‘‘(J) amounts includible in gross income 
under section 951A(a);’’. 
(5) Section 856(c)(3)(D) is amended by strik-
ing ‘‘dividends or other distributions on, and gain’’ 
and inserting ‘‘dividends, other distributions on, 
amounts includible in gross income under section 
951A(a) with respect to, and gain’’. 
(6) The table of sections for subpart F of part 
III of subchapter N of chapter 1 is amended by in-
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serting after the item relating to section 951 the fol-
lowing new item: 
‘‘Sec. 951A. Foreign high return amount included in gross income of United 
States shareholders.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years of foreign corpora-
tions beginning after December 31, 2017, and to taxable 
years of United States shareholders in which or with which 
such taxable years of foreign corporations end. 
SEC. 4302. LIMITATION ON DEDUCTION OF INTEREST BY 
DOMESTIC CORPORATIONS WHICH ARE MEM-
BERS OF AN INTERNATIONAL FINANCIAL RE-
PORTING GROUP. 
(a) IN GENERAL.—Section 163 is amended by redes-
ignating subsection (n) as subsection (p) and by inserting 
after subsection (m) the following new subsection: 
‘‘(n) LIMITATION ON DEDUCTION OF INTEREST BY 
DOMESTIC CORPORATIONS
IN INTERNATIONAL FINAN-
CIAL REPORTING GROUPS.— 
‘‘(1) IN GENERAL.—In the case of any domestic 
corporation which is a member of any international 
financial reporting group, the deduction under this 
chapter for interest paid or accrued during the tax-
able year shall not exceed the sum of— 
‘‘(A) the allowable percentage of 110 per-
cent of the excess (if any) of — 
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‘‘(i) the amount of such interest so 
paid or accrued, over 
‘‘(ii) the amount described in subpara-
graph (B), plus 
‘‘(B) the amount of interest includible in 
gross income of such corporation for such tax-
able year. 
‘‘(2) INTERNATIONAL
FINANCIAL
REPORTING 
GROUP.— 
‘‘(A) For purposes of this subsection, the 
term ‘international financial reporting group’ 
means, with respect to any reporting year, any 
group of entities which— 
‘‘(i) includes— 
‘‘(I) at least one foreign corpora-
tion engaged in a trade or business 
within the United States, or 
‘‘(II) at least one domestic cor-
poration and one foreign corporation, 
‘‘(ii) prepares consolidated financial 
statements with respect to such year, and 
‘‘(iii) reports in such statements aver-
age annual gross receipts (determined in 
the aggregate with respect to all entities 
which are part of such group) for the 3-re-
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porting-year period ending with such re-
porting year in excess of $100,000,000. 
‘‘(B) RULES
RELATING
TO
DETERMINA-
TION OF AVERAGE GROSS RECEIPTS.—For pur-
poses of subparagraph (A)(iii), rules similar to 
the rules of section 448(c)(3) shall apply. 
‘‘(3) ALLOWABLE PERCENTAGE.—For purposes 
of this subsection— 
‘‘(A) IN
GENERAL.—The term ‘allowable 
percentage’ means, with respect to any domestic 
corporation for any taxable year, the ratio (ex-
pressed as a percentage and not greater than 
100 percent) of— 
‘‘(i) such corporation’s allocable share 
of the international financial reporting 
group’s reported net interest expense for 
the reporting year of such group which 
ends in or with such taxable year of such 
corporation, over 
‘‘(ii) such corporation’s reported net 
interest expense for such reporting year of 
such group. 
‘‘(B) 
REPORTED
NET
INTEREST
EX-
PENSE.—The term ‘reported net interest ex-
pense’ means— 
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