Bill > S1671

This bill, the Foreign Earnings Reinvestment Act, amends the Internal Revenue Code to provide tax incentives for domestic corporations that reinvest foreign earnings in the United States and expand their payrolls. Specifically, it allows a temporary deduction for dividends received from a controlled foreign corporation (a foreign corporation where a U.S. corporation owns more than 50% of the voting power or value) for taxable years beginning before or during a one-year period after the bill's enactment. The bill also reduces tax rates on foreign earnings if these earnings are reinvested in the U.S. and the corporation increases its payroll compared to 2010 levels, offering a bonus deduction for the first year following the election year if payroll increases. Conversely, it increases the taxable income of domestic corporations that fail to maintain their employment levels for 23 months after receiving a tax rate reduction under this Act, with penalties calculated based on the number of employees lost below a prior average employment level.