Bill > HR2186

This bill amends the Internal Revenue Code to modify how stock ownership is attributed in tax regulations, particularly for foreign corporations and US shareholders. Specifically, the bill prevents the automatic attribution of stock ownership from foreign entities to US persons, which could previously occur under certain constructive ownership rules. The legislation introduces a new category called "foreign controlled United States shareholders" and "foreign controlled foreign corporations," which are defined by more stringent ownership thresholds - changing the definition from 10% ownership to more than 50% ownership. The bill requires that certain tax provisions be applied separately and additionally to these new categories of shareholders and corporations, potentially increasing tax transparency and preventing potential tax avoidance strategies. The amendments will apply to taxable years of foreign corporations beginning before January 1, 2025, and the corresponding taxable years of US persons. The bill explicitly states that these changes should not be interpreted as creating any inference about how tax rules were applied in years prior to these amendments, thus providing clarity and preventing retroactive interpretations.

Budget and Finance

https://www.congress.gov/bill/119th-congress/house-bill/2186/all-info