II
118THCONGRESS
1
STSESSION S. 3155
To amend the Internal Revenue Code of 1986 to expand the denial of
deduction for certain excessive employee remuneration, and for other purposes.
IN THE SENATE OF THE UNITED STATES
OCTOBER26, 2023
Mr. R
EED(for himself, Mr. BLUMENTHAL, Mr. WHITEHOUSE, Ms. BALDWIN,
Ms. W
ARREN, Mr. MERKLEY, Mr. VANHOLLEN, and Mr. SANDERS) in-
troduced the following bill; which was read twice and referred to the Com-
mittee on Finance
A BILL
To amend the Internal Revenue Code of 1986 to expand
the denial of deduction for certain excessive employee
remuneration, and for other purposes.
Be it enacted by the Senate and House of Representa-1
tives of the United States of America in Congress assembled, 2
SECTION 1. SHORT TITLE. 3
This Act may be cited as the ‘‘Stop Subsidizing Mul-4
timillion Dollar Corporate Bonuses Act’’. 5
SEC. 2. EXPANSION OF DENIAL OF DEDUCTION FOR CER-6
TAIN EXCESSIVE EMPLOYEE REMUNERA-7
TION. 8
(a) I
NGENERAL.— 9
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•S 3155 IS
(1) EXPANSION.—Section 162(m) of the Inter-1
nal Revenue Code of 1986 is amended— 2
(A) by striking ‘‘applicable employee remu-3
neration’’ each place it appears in paragraphs 4
(1), (4), and (5)(E) and inserting ‘‘applicable 5
remuneration’’, 6
(B) by striking ‘‘covered employee’’ each 7
place it appears in paragraphs (1) and (4) and 8
inserting ‘‘covered individual’’, and 9
(C) by striking ‘‘employee’’ each place it 10
appears in paragraph (1) and subparagraphs 11
(A), (C)(ii), and (E) of paragraph (4) and in-12
serting ‘‘individual’’. 13
(2) C
OVERED INDIVIDUAL.—Paragraph (3) of 14
section 162(m) of such Code is amended to read as 15
follows: 16
‘‘(3) C
OVERED INDIVIDUAL.—For purposes of 17
this subsection, the term ‘covered individual’ 18
means— 19
‘‘(A) any individual who performs services 20
(directly or indirectly) for the taxpayer (or any 21
predecessor) for any taxable year beginning 22
after December 31, 2022, or 23
‘‘(B) any employee— 24
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•S 3155 IS
‘‘(i) who was the principal executive 1
officer or principal financial officer of the 2
taxpayer (or any predecessor) at any time 3
during any preceding taxable year begin-4
ning after December 31, 2016, and before 5
January 1, 2023, or who was an individual 6
acting in such a capacity, or 7
‘‘(ii) the total compensation of whom 8
for any taxable year described in clause (i) 9
was required to be reported to shareholders 10
under the Securities Exchange Act of 1934 11
by reason of such individual being among 12
the 3 highest compensated officers for the 13
taxable year (other than any individual de-14
scribed in clause (i)). 15
Such term shall include any employee who would be 16
described in subparagraph (B)(ii) if the reporting 17
described in such subparagraph were required as so 18
described.’’. 19
(3) C
ONFORMING AMENDMENTS .— 20
(A) The heading for section 162(m) of the 21
Internal Revenue Code of 1986 is amended by 22
striking ‘‘E
MPLOYEE’’. 23
(B) The heading for section 162(m)(4) is 24
amended by striking ‘‘
EMPLOYEE’’. 25
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•S 3155 IS
(b) MODIFICATION OF DEFINITION OFPUBLICLY 1
H
ELDCORPORATION.—Section 162(m)(2) of the Internal 2
Revenue Code of 1986 is amended— 3
(1) by inserting ‘‘, with respect to any taxable 4
year,’’ after ‘‘means’’, and 5
(2) by striking subparagraph (B) and inserting 6
the following: 7
‘‘(B) that was required to file reports 8
under section 15(d) of such Act (15 U.S.C. 9
78o(d)) at any time during the 3-taxable year 10
period ending with such taxable year.’’. 11
(c) R
EGULATORYAUTHORITY.— 12
(1) I
N GENERAL.—Section 162(m) of the Inter-13
nal Revenue Code of 1986 is amended by adding at 14
the end the following new paragraph: 15
‘‘(7) R
EGULATIONS.—The Secretary may pre-16
scribe such guidance, rules, or regulations as are 17
necessary to carry out the purposes of this sub-18
section, including regulations— 19
‘‘(A) with respect to reporting, and 20
‘‘(B) to prevent avoidance of the purposes 21
of this section by providing compensation 22
through a pass-through or other entity.’’. 23
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•S 3155 IS
(2) CONFORMING AMENDMENT .—Paragraph (6) 1
of section 162(m) of such Code is amended by strik-2
ing subparagraph (H). 3
(d) E
FFECTIVEDATE.—The amendments made by 4
this section shall apply to taxable years beginning after 5
December 31, 2022. 6
Æ
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