← Back to Bills
H.R. 399House115th Congress (2017-2019)In Committee

Stop Subsidizing Multimillion Dollar Corporate Bonuses Act

Sponsored by Lloyd DoggettRep. Lloyd Doggett (D-TX)
Introduced January 10, 2017

AI-Generated Summary

Updated April 15, 2026 at 11:28 AM UTC

The Stop Subsidizing Multimillion Dollar Corporate Bonuses Act changes the tax code so that publicly‑held corporations can no longer deduct large bonuses and other excessive compensation paid to their officers, directors, and employees, including former ones. It broadens the definition of who is covered, removes exemptions for commission‑based or performance‑based pay, and lets the Treasury issue rules to enforce the changes. The rule applies to tax years starting after December 31, 2017 and affects any corporation that files reports with the SEC.

Key Provisions

  • Expands the term “covered individual” to include any current or former officer, director, or employee of a corporation, removing the previous “covered employee” limitation.
  • Eliminates the exception that allowed commission‑based pay to be deductible, making all such compensation subject to the denial rule.
  • Adds performance‑based compensation to the list of remuneration that cannot be deducted when excessive.
  • Redefines “publicly held corporation” to match SEC reporting requirements, so the rule applies to any corporation that registers securities or files SEC reports.
  • Authorizes the Treasury Secretary to issue regulations and guidance needed to enforce the expanded denial of deductions.

Legislative Activity

Stay on top of the latest movement without scrolling through every action

1 earlier action
HouseIntro Referral Latest Action

Referred to the House Committee on Ways and Means.

Ways and Means Committee

January 10, 2017

View full timeline
HouseIntro Referral

Introduced in House

January 10, 2017

HouseIntro Referral

Referred to the House Committee on Ways and Means.

Ways and Means Committee

January 10, 2017

Bill Text

Latest available legislative text

Reading Mode
Latest
Raw Text PDF XML
Introduced in HouseIssued January 10, 2017

I

115th CONGRESS

1st Session

H. R. 399

IN THE HOUSE OF REPRESENTATIVES

January 10, 2017

Mr. Doggett (for himself, Mr. Beyer, Mr. Brady of Pennsylvania, Ms. Brownley of California, Mr. Cicilline, Mr. Conyers, Mr. Cummings, Mr. DeFazio, Ms. DeLauro, Mr. Ellison, Mr. Gallego, Mr. Garamendi, Mr. Grijalva, Mr. Hastings, Mr. Higgins of New York, Mr. Langevin, Ms. Lee, Mr. Ted Lieu of California, Mr. Lipinski, Mr. Loebsack, Mr. Lowenthal, Mr. Sean Patrick Maloney of New York, Mr. McGovern, Ms. Moore, Mrs. Napolitano, Ms. Norton, Mr. Payne, Mr. Pocan, Mr. Price of North Carolina, Ms. Roybal-Allard, Ms. Schakowsky, Mr. Serrano, Ms. Slaughter, Mr. Tonko, Ms. Tsongas, Ms. Velázquez, Mr. Visclosky, Mrs. Watson Coleman, Mr. Yarmuth, Mr. Raskin, Ms. Kaptur, Mr. DeSaulnier, and Mr. Huffman) 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 expand the denial of deduction for certain excessive employee remuneration, and for other purposes.

1.

Short title

This Act may be cited as the Stop Subsidizing Multimillion Dollar Corporate Bonuses Act.

2.

Expansion of denial of deduction for certain excessive employee remuneration

(a)

Application to all current and former employees

(1)

In general

Section 162(m) of the Internal Revenue Code of 1986 is amended—

(A)

by striking covered employee each place it appears in paragraphs (1) and (4) and inserting covered individual, and

(B)

by striking such employee each place it appears in subparagraphs (A) and (G) of paragraph (4) and inserting such individual.

(2)

Covered individual

Paragraph (3) of section 162(m) of such Code is amended to read as follows:

(3)

Covered individual

For purposes of this subsection, the term covered individual means any individual who is an officer, director, or employee of the taxpayer or a former officer, director, or employee of the taxpayer.

.

(3)

Conforming amendments

(A)

Section 48D(b)(3)(A) of such Code is amended by inserting (as in effect for taxable years beginning before January 1, 2018) after section 162(m)(3).

(B)

Section 409A(b)(3)(D)(ii) of such Code is amended by inserting (as in effect for taxable years beginning before January 1, 2018) after section 162(m)(3).

(b)

Expansion of applicable employee remuneration

(1)

Elimination of exception for commission-based pay

(A)

In general

Paragraph (4) of section 162(m) of such Code, as amended by subsection (a), is amended by striking subparagraph (B) and by redesignating subparagraphs (C) through (G) as subparagraphs (B) through (F), respectively.

(B)

Conforming amendments

(i)

Section 162(m)(5) of such Code is amended—

(I)

by striking subparagraphs (B), (C), and (D) thereof in subparagraph (E) and inserting subparagraphs (B) and (C) thereof, and

(II)

by striking subparagraphs (F) and (G) in subparagraph (G) and inserting subparagraphs (E) and (F).

(ii)

Section 162(m)(6) of such Code is amended—

(I)

by striking subparagraphs (B), (C), and (D) thereof in subparagraph (D) and inserting subparagraphs (B) and (C) thereof, and

(II)

by striking subparagraphs (F) and (G) in subparagraph (G) and inserting subparagraphs (E) and (F).

(2)

Inclusion of performance-based compensation

(A)

In general

Paragraph (4) of section 162(m) of the Internal Revenue Code of 1986, as amended by subsection (a) and paragraph (1) of this subsection, is amended by striking subparagraph (B) and redesignating subparagraphs (C) through (F) as subparagraphs (B) through (E), respectively.

(B)

Conforming amendments

(i)

Section 162(m)(5) of such Code, as amended by paragraph (1), is amended—

(I)

by striking subparagraphs (B) and (C) thereof in subparagraph (E) and inserting subparagraph (B) thereof, and

(II)

by striking subparagraphs (E) and (F) in subparagraph (G) and inserting subparagraphs (D) and (E).

(ii)

Section 162(m)(6) of such Code, as amended by paragraph (1), is amended—

(I)

by striking subparagraphs (B) and (C) thereof in subparagraph (D) and inserting subparagraph (B) thereof, and

(II)

by striking subparagraphs (E) and (F) in subparagraph (G) and inserting subparagraphs (D) and (E).

(c)

Expansion of applicable employer

Paragraph (2) of section 162(m) of the Internal Revenue Code of 1986 is amended to read as follows:

(2)

Publicly held corporation

For purposes of this subsection, the term publicly held corporation means any corporation which is an issuer (as defined in section 3 of the Securities Exchange Act of 1934 (15 U.S.C. 78c))—

(A)

the securities of which are registered under section 12 of such Act (15 U.S.C. 78l), or

(B)

that is required to file reports under section 15(d) of such Act (15 U.S.C. 780(d)).

.

(d)

Regulatory authority

(1)

In general

Section 162(m) of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

(7)

Regulations

The Secretary may prescribe such guidance, rules, or regulations, including with respect to reporting, as are necessary to carry out the purposes of this subsection.

.

(2)

Conforming amendment

Paragraph (6) of section 162(m) of such Code is amended by striking subparagraph (H).

(e)

Effective date

The amendments made by this section shall apply to taxable years beginning after December 31, 2017.