To amend the Internal Revenue Code of 1986 to provide that certain payments to foreign related parties subject to sufficient foreign tax are not treated as base erosion payments.

# HR 1911 Summary **What the Bill Would Do** This bill would modify U.S. tax law to exempt certain business payments made to foreign-owned related companies from being counted as "base erosion payments." Base erosion refers to when U.S. companies reduce their taxable income by paying money to foreign subsidiaries or related entities. Currently, there are rules limiting these deductions to prevent companies from shifting profits overseas to avoid U.S. taxes. This bill would allow some of these payments to be deducted if the foreign recipient already pays sufficient taxes in their country. **Who It Affects and Key Provisions** The bill would primarily affect U.S.

multinational corporations that make payments to foreign subsidiary companies or related entities. By exempting certain payments from base erosion restrictions, eligible companies could deduct more payments to foreign subsidiaries, potentially lowering their U.S. tax bills. The relief would only apply when the foreign recipient is subject to what the bill considers "sufficient foreign tax," though specific thresholds aren't detailed in the bill description. **Current Status** As of now, the bill is in committee, meaning it has been introduced but not yet debated or voted on by the full House of Representatives. It was sponsored by Representative Herbert Conaway (D-NJ).