S. 1284Senate110th Congress (2007-2009)In Committee

A bill to amend the Internal Revenue Code of 1986 to provide for the taxation of income of controlled foreign corporations attributable to imported property.

Introduced May 3, 2007

Legislative Activity

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2 earlier actions
SenateIntro Referral Latest Action

Read twice and referred to the Committee on Finance.

May 3, 2007

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SenateIntro Referral

Introduced in Senate

May 3, 2007

SenateIntro Referral

Sponsor introductory remarks on measure. (CR S5571)

May 3, 2007

SenateIntro Referral

Read twice and referred to the Committee on Finance.

May 3, 2007

Floor Debate

17 members

What members said about S. 1284 on the floor

7 Republicans10 Democrats
Larry E. Craig
Sen. Larry E. CraigR-ID · May 3, 2007

Mr. President, I have sought recognition today to comment on a bill I am introducing to help ensure the long-term ability of the United States Court of Appeals for Veterans Claims to promptly…

Richard J. Durbin
Sen. Richard J. DurbinD-IL · May 3, 2007

Mr. President, I rise today to introduce the bipartisan Methamphetamine Production Prevention Act of 2007. I am pleased to have the support and cosponsorship of Senator Grassley for this important…

Edward M. Kennedy
Sen. Edward M. KennedyD-MA · May 3, 2007

Mr. President, I am pleased today to introduce the Keeping Parents and Communities Engaged or Keeping PACE Act, to foster greater involvement of parents in their children's education, engage…

Norm Coleman
Sen. Norm ColemanR-MN · May 3, 2007

Mr. President, I rise to introduce the Medicare Provider Accountability Act on behalf of myself, and my colleagues Senator Levin and Senator McCaskill. This bill is a direct result of the recent…

John F. Kerry
Sen. John F. KerryD-MA · May 3, 2007

Mr. President, I am pleased to join my colleagues Senators Smith, Conrad, Snowe, and Bingaman in introducing the Women's Retirement Security Act of 2007. This legislation comes on the heels of the…

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Carl Levin
Sen. Carl LevinD-MI · May 3, 2007

Mr. President, I join today with my colleagues, Senator Coleman and Senator McCaskill, in introducing the Medicare Provider Accountability Act. This bill targets Medicare, a program which is…

Chuck Grassley
Sen. Chuck GrassleyR-IA · May 3, 2007

Mr. President, I am pleased to join my colleague, Senator Durbin, in introducing the Methamphetamine Production Prevention Act of 2007. Together we offer this important legislation in an effort to…

Byron L. Dorgan
Sen. Byron L. DorganD-ND · May 3, 2007

Mr. President, today I am joined by Senators Mikulski, Durbin, Stabenow, Rockefeller, Levin, Feinstein, Johnson, Harkin, Feingold, Leahy, Kohl, and Kennedy in introducing legislation to close an…

Byron L. Dorgan
Sen. Byron L. DorganD-ND · May 3, 2007

Mr. President, today I am joined by Senators Mikulski, Durbin, Stabenow, Rockefeller, Levin, Feinstein, Johnson, Harkin, Feingold, Leahy, Kohl, and Kennedy in introducing legislation to close an…

Daniel K. Akaka
Sen. Daniel K. AkakaD-HI · May 3, 2007

Mr. President, I rise today, along with my friends Senators Durbin and Cochran, to reintroduce legislation that will provide students much needed educational opportunities in foreign languages and…

Benjamin L. Cardin
Sen. Benjamin L. CardinD-MD · May 3, 2007

Mr. President, as you know, teachers are the most valuable resource when it comes to educating our Nation's children. Under the No Child Left Behind Act, (NCLB), States are required to recruit highly…

Mark L. Pryor
Sen. Mark L. PryorD-AR · May 3, 2007

Mr. President, I thank the Senator from Georgia for his kind remarks. Of course, everybody in the Senate knows what a friend to the men and women in uniform Senator Chambliss has been since he has…

Saxby Chambliss
Sen. Saxby ChamblissR-GA · May 3, 2007

Mr. President, I rise today to join my colleague and my good friend, the Senator from Arkansas, Mr. Pryor, in introducing legislation to ensure that the medical needs of wounded service men and women…

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Charles E. Schumer
Sen. Charles E. SchumerD-NY · May 3, 2007

Mr. President, today I, along with Senators Lott and Conrad, introduce the Medicare Ambulance Payment Extension Act. Without this legislation, ambulance service providers stand to lose $306 million…

John McCain
Sen. John McCainR-AZ · May 3, 2007

Mr. President, I am pleased to be joined today by Senator Kyl in introducing the Arizona Trail Feasibility National Scenic Trail Act. This bill would designate the Arizona Trail as a National Scenic…

Gordon H. Smith
Sen. Gordon H. SmithR-OR · May 3, 2007

Mr. President, today I am introducing the Women's Retirement Security Act of 2007. This measure has the potential to make a significantly positive impact on the ability of Americans to save for their…

Jon Kyl
Sen. Jon KylR-AZ · May 3, 2007

Mr. President, today I am pleased to join with Senator McCain in introducing the Arizona National Scenic Trail Act. This bill would amend the National Trails System Act to designate the Arizona Trail…

Jack Reed
Sen. Jack ReedD-RI · May 3, 2007

Mr. President, I join my colleague, Senator Kerry, in introducing the Reinsure America's Businesses Act of 2007. This legislation represents a critical step forward in bringing affordable health care…

Bill Text

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Introduced in SenateIssued May 3, 2007

II

110th CONGRESS

1st Session

S. 1284

IN THE SENATE OF THE UNITED STATES

May 3, 2007

Mr. Dorgan (for himself, Ms. Mikulski, Mr. Durbin, Ms. Stabenow, Mr. Rockefeller, Mr. Levin, Mrs. Feinstein, Mr. Johnson, Mr. Harkin, Mr. Feingold, Mr. Leahy, Mr. Kohl, and Mr. Kennedy) introduced the following bill; which was read twice and referred to the Committee on Finance

A BILL

To amend the Internal Revenue Code of 1986 to provide for the taxation of income of controlled foreign corporations attributable to imported property.

1.

Taxation of income of controlled foreign corporations attributable to imported property

(a)

General Rule

Subsection (a) of section 954 of the Internal Revenue Code of 1986 (defining foreign base company income) is amended by striking and at the end of paragraph (4), by striking the period at the end of paragraph (5) and inserting , and, and by adding at the end the following new paragraph:

(6)

imported property income for the taxable year (determined under subsection (j) and reduced as provided in subsection (b)(5)).

.

(b)

Definition of Imported Property Income

Section 954 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:

(j)

Imported Property Income

(1)

In general

For purposes of subsection (a)(6), the term imported property income means income (whether in the form of profits, commissions, fees, or otherwise) derived in connection with—

(A)

manufacturing, producing, growing, or extracting imported property;

(B)

the sale, exchange, or other disposition of imported property; or

(C)

the lease, rental, or licensing of imported property.

Such term shall not include any foreign oil and gas extraction income (within the meaning of section 907(c)) or any foreign oil related income (within the meaning of section 907(c)).
(2)

Imported property

For purposes of this subsection—

(A)

In general

Except as otherwise provided in this paragraph, the term imported property means property which is imported into the United States by the controlled foreign corporation or a related person.

(B)

Imported property includes certain property imported by unrelated persons

The term imported property includes any property imported into the United States by an unrelated person if, when such property was sold to the unrelated person by the controlled foreign corporation (or a related person), it was reasonable to expect that—

(i)

such property would be imported into the United States; or

(ii)

such property would be used as a component in other property which would be imported into the United States.

(C)

Exception for property subsequently exported

The term imported property does not include any property which is imported into the United States and which—

(i)

before substantial use in the United States, is sold, leased, or rented by the controlled foreign corporation or a related person for direct use, consumption, or disposition outside the United States; or

(ii)

is used by the controlled foreign corporation or a related person as a component in other property which is so sold, leased, or rented.

(D)

Exception for certain agricultural commodities

The term imported property does not include any agricultural commodity which is not grown in the United States in commercially marketable quantities.

(3)

Definitions and special rules

(A)

Import

For purposes of this subsection, the term import means entering, or withdrawal from warehouse, for consumption or use. Such term includes any grant of the right to use intangible property (as defined in section 936(h)(3)(B)) in the United States.

(B)

United states

For purposes of this subsection, the term United States includes the Commonwealth of Puerto Rico, the Virgin Islands of the United States, Guam, American Samoa, and the Commonwealth of the Northern Mariana Islands.

(C)

Unrelated person

For purposes of this subsection, the term unrelated person means any person who is not a related person with respect to the controlled foreign corporation.

(D)

Coordination with foreign base company sales income

For purposes of this section, the term foreign base company sales income shall not include any imported property income.

.

(c)

Separate Application of Limitations on Foreign Tax Credit for Imported Property Income

(1)

In general

Paragraph (1) of section 904(d) of the Internal Revenue Code of 1986 (relating to separate application of section with respect to certain categories of income) is amended by striking and at the end of subparagraph (A), by redesignating subparagraph (B) as subparagraph (C), and by inserting after subparagraph (A) the following new subparagraph:

(B)

imported property income, and

.

(2)

Imported property income defined

Paragraph (2) of section 904(d) of such Code is amended by redesignating subparagraphs (I) and (J) as subparagraphs (J) and (K), respectively, and by inserting after subparagraph (H) the following new subparagraph:

(I)

Imported property income

The term imported property income means any income received or accrued by any person which is of a kind which would be imported property income (as defined in section 954(j)).

.

(3)

Conforming amendment

Clause (ii) of section 904(d)(2)(A) of such Code is amended by inserting or imported property income after passive category income.

(d)

Technical Amendments

(1)

Clause (iii) of section 952(c)(1)(B) of the Internal Revenue Code of 1986 (relating to certain prior year deficits may be taken into account) is amended—

(A)

by redesignating subclauses (II), (III), (IV), and (V) as subclauses (III), (IV), (V), and (VI), and

(B)

by inserting after subclause (I) the following new subclause:

(II)

imported property income,

.

(2)

Paragraph (5) of section 954(b) of such Code (relating to deductions to be taken into account) is amended by striking and the foreign base company oil related income and inserting the foreign base company oil related income, and the imported property income.

(e)

Effective Date

The amendments made by this section shall apply to taxable years of foreign corporations beginning after the date of the enactment of this Act, and to taxable years of United States shareholders within which or with which such taxable years of such foreign corporations end.