Bill > HR7559

This bill proposes to amend the Internal Revenue Code of 1986 to disallow tax deductions for certain "outsourcing payments," which are defined as any premium, fee, royalty, service charge, or other payment made in the course of a trade or business to a foreign person (meaning someone not a U.S. person, with some exceptions for entities organized in U.S. possessions) when the benefit of the labor or services is directed to consumers in the United States. If a payment benefits consumers both inside and outside the U.S., only the portion attributable to services directed to U.S. consumers will be considered an outsourcing payment. The Secretary of the Treasury will be responsible for issuing regulations to implement these changes and prevent avoidance. These provisions are set to take effect for payments made after December 31, 2025.