Bill Details
View committees (1)
View cosponsors (8)
- Rep. Plaskett, Stacey E. [D-Virgin Islands]
- Rep. Hern, Kevin [R-Oklahoma-1]
- Rep. Sewell, Terri A. [D-Alabama-7]
- Rep. Feenstra, Randy [R-Iowa-4]
- Rep. Schneider, Bradley Scott [D-Illinois-10]
- Rep. Miller, Carol D. [R-West Virginia-1]
- Rep. Miller, Max L. [R-Ohio-7]
- Rep. DelBene, Suzan K. [D-Washington-1]
AI Summary This summary was generated by AI from the bill text. AI can get information wrong.
This bill would change a U.S. tax rule so that certain income from services performed in the U.S. Virgin Islands would not count the same way under the global minimum tax-style rule known as GILTI. In plain language, it is meant to help support businesses and investment in the Virgin Islands by giving some tax relief for income earned from qualifying service work there. The bill also gives the Treasury Department authority to write rules to prevent abuse and make sure the change is applied correctly.
- It creates a new type of income called “qualified Virgin Islands services income.” This covers pay for labor or personal services performed in the Virgin Islands by a corporation formed under Virgin Islands law.
- To qualify, the income must come from services done from within the Virgin Islands by people working for that corporation, and it must be tied to a trade or business carried on in the Virgin Islands.
- The change would apply only to certain U.S. shareholders, including individuals, trusts, estates, and some closely held C corporations that owned their interest before December 31, 2023.
- The new rules would take effect for foreign corporation tax years beginning after the bill becomes law, and for the matching tax years of the U.S. shareholders affected by those foreign corporation years.
Official Summaries
Restore Economic Vitality and Investment in the Virgin Islands Act or the REVIVE VI Act
This bill allows certain U.S. shareholders of a controlled foreign corporation to exclude qualified Virgin Islands service income from the calculation of global intangible low-taxed income (GILTI) for federal tax purposes. It also requires the Internal Revenue Service (IRS) to issue guidance on the exclusion. (Some limitations apply.)
Under current law, U.S. shareholders that own 10% or more of a controlled foreign corporation are required to include in gross income the GILTI of the controlled foreign corporation. The calculation of GILTI is based, in part, on the controlled foreign corporation’s tested income (the controlled foreign corporation’s gross income excluding certain types of income and dividends).
Under the bill, specified U.S. shareholders (individuals, trusts, estates, and certain closely-held C corporations) may exclude qualified Virgin Islands service income from a controlled foreign corporation’s gross income for purposes of calculating the controlled foreign corporation’s tested income.
The bill defines qualified Virgin Islands service income as gross income that is
- compensation for labor or personal services performed in the Virgin Islands by a corporation formed under Virgin Islands laws,
- attributable to services performed in the Virgin Islands by individuals for the benefit of such corporation, and
- effectively connected with the conduct of a trade or business in the Virgin Islands.
Finally, the bill requires the IRS to issue guidance on the exclusion of qualified Virgin Island service income from the GILTI calculation.
Current Full Text
[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 858 Introduced in House (IH)]
<DOC>
119th CONGRESS
1st Session
H. R. 858
To amend the Internal Revenue Code of 1986 to determine global
intangible low-taxed income without regard to certain income derived
from services performed in the Virgin Islands.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
January 31, 2025
Mr. Estes (for himself, Ms. Plaskett, Mr. Hern of Oklahoma, Ms. Sewell,
Mr. Feenstra, and Mr. Schneider) introduced the following bill; which
was referred to the Committee on Ways and Means
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to determine global
intangible low-taxed income without regard to certain income derived
from services performed in the Virgin Islands.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Restore Economic Vitality and
Investment in the Virgin Islands Act'' or the ``REVIVE VI Act''.
SEC. 2. GLOBAL INTANGIBLE LOW-TAXED INCOME DETERMINED WITHOUT REGARD TO
CERTAIN INCOME DERIVED FROM SERVICES PERFORMED IN THE
VIRGIN ISLANDS.
(a) In General.--Section 951A(c)(2)(A)(i) of the Internal Revenue
Code of 1986 is amended by striking ``and'' at the end of subclause
(IV), by striking the period at the end of subclause (V) and inserting
``, and'', and by adding at the end the following new subclause:
``(VI) in the case of any specified
United States shareholder, any
qualified Virgin Islands services
income.''.
(b) Definitions and Special Rules.--Section 951A(c)(2) of such Code
is amended by adding at the end the following new subparagraph:
``(C) Provisions related to qualified virgin
islands services income.--For purposes of subparagraph
(A)(i)(VI)--
``(i) Qualified virgin islands services
income.--The term `qualified Virgin Islands
services income' means any gross income which
satisfies all of the following requirements:
``(I) Such gross income is
compensation for labor or personal
services (within the meaning of section
862(a)(3)) performed in the Virgin
Islands by a corporation formed under
the laws of the Virgin Islands.
``(II) Such gross income is
attributable to services performed from
within the Virgin Islands by
individuals for the benefit of such
corporation.
``(III) Such gross income is
effectively connected with the conduct
of a trade or business within the
Virgin Islands.
``(ii) Specified united states
shareholder.--The term `specified United States
shareholder' means any United States
shareholder which is--
``(I) an individual, trust, or
estate, or
``(II) a closely held C corporation
(as defined in section 469(j)(1)) if
such corporation acquired its direct or
indirect equity interest in the foreign
corporation which derived the qualified
Virgin Islands services income before
December 31, 2023.
``(iii) Regulations.--The Secretary shall
prescribe such regulations or other guidance as
may be necessary or appropriate to carry out
this subparagraph and subparagraph (A)(i)(VI),
including regulations or other guidance to
prevent the abuse of such subparagraphs.''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years of foreign corporations beginning after the date
of the enactment of this Act, and to taxable years of United States
shareholders with or within which such taxable years of foreign
corporations end.
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