Bill > HR3140

This bill aims to expand restrictions on tax deductions for excessive employee compensation in corporations by modifying Section 162(m) of the Internal Revenue Code. Specifically, the bill broadens the definition of "covered individual" to include not just current top executives, but also former high-ranking employees who were among the top three highest-compensated officers in previous years, starting from 2016. The bill changes terminology from "employee" to "individual" and expands the scope of who is considered a covered individual for compensation reporting purposes. It also modifies the definition of a publicly held corporation by adjusting reporting requirements, allowing the IRS Secretary to create regulations to prevent companies from circumventing these rules through pass-through or other entities. The changes would apply to taxable years beginning after December 31, 2024, with the goal of limiting corporate tax deductions for multimillion-dollar executive bonuses and ensuring more transparent compensation reporting. By restricting tax benefits for excessive compensation, the bill seeks to discourage what some view as unreasonably high executive pay.

Budget and Finance

https://www.congress.gov/bill/119th-congress/house-bill/3140/all-info