I 
118TH CONGRESS 
2D SESSION 
H. R. 9843 
To amend the Internal Revenue Code of 1986 to incentivize the divestiture 
of certain securities connected to the People’s Republic of China. 
IN THE HOUSE OF REPRESENTATIVES 
SEPTEMBER 25, 2024 
Mr. MOOLENAAR introduced the following bill; which was referred to the 
Committee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to incentivize 
the divestiture of certain securities connected to the Peo-
ple’s Republic of China. 
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 ‘‘Patriotic Investment 
Act’’. 
SEC. 2. INCENTIVES TO DIVEST DISQUALIFIED PRC SECU-
RITIES. 
(a) TREATMENT AS ORDINARY GAIN.—Part IV of 
subchapter P of chapter 1 of the Internal Revenue Code 
VerDate Sep 11 2014 
01:21 Oct 12, 2024
Jkt 059200
PO 00000
Frm 00001
Fmt 6652
Sfmt 6201
E:\BILLS\H9843.IH
H9843
ssavage on LAPJG3WLY3PROD with BILLS
of 1986 is amended by adding at the end the following 
new section: 
‘‘SEC. 1261. GAIN FROM DISPOSITION OF DISQUALIFIED 
PRC SECURITIES. 
‘‘(a) IN GENERAL.—Any gain on the disposition of 
any disqualified PRC security shall be treated as ordinary 
income and shall be recognized notwithstanding any other 
provision of this subtitle. 
‘‘(b) DEFINITIONS.—For purposes of this section— 
‘‘(1) DISQUALIFIED PRC SECURITY.—The term 
‘disqualified PRC security’ means any specified in-
terest held directly or indirectly with respect to any 
of the following: 
‘‘(A) The Government of the People’s Re-
public of China or any other governmental enti-
ty based in the People’s Republic of China. 
‘‘(B) The Chinese Communist Party or 
any subdivision or affiliate thereof. 
‘‘(C) A person who is a citizen, national, or 
resident of the People’s Republic of China, pro-
vided that such person is not an individual who 
is— 
‘‘(i) a citizen or lawful permanent 
resident of the United States, or 
VerDate Sep 11 2014 
01:21 Oct 12, 2024
Jkt 059200
PO 00000
Frm 00002
Fmt 6652
Sfmt 6201
E:\BILLS\H9843.IH
H9843
ssavage on LAPJG3WLY3PROD with BILLS
‘‘(ii) domiciled in Taiwan possessing a 
valid identification card or number issued 
by the Government of Taiwan. 
‘‘(D) A person (including a legal entity) 
headquartered, organized under the laws of, or 
having its principal place of business in the 
People’s Republic of China. 
‘‘(E) A person at least 15 percent of the 
outstanding voting interest of which is held di-
rectly or indirectly by an entity described in 
subparagraphs (A)–(D). 
‘‘(F) A person at least 25 percent of the 
outstanding voting interest of which is held di-
rectly or indirectly by any combination of per-
sons described in subparagraphs (A)–(E). 
‘‘(2) SPECIFIED INTEREST.—The term ‘speci-
fied interest’— 
‘‘(A) means, with respect to a person— 
‘‘(i) stock or any other equity or prof-
its interest of such person, 
‘‘(ii) debt issued by such person, and 
‘‘(iii) any contract or derivative with 
respect to an interest described in clause 
(i) or (ii), and 
VerDate Sep 11 2014 
01:21 Oct 12, 2024
Jkt 059200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6201
E:\BILLS\H9843.IH
H9843
ssavage on LAPJG3WLY3PROD with BILLS