,i  #aafth ,,congress  #ast ,session    
,h4 ,r4 #dab  ,,in ,,the ,,house ,,of   
,,representatives  ,january #i1         
#bjai,ms4 ,plaskett introduced the      
following bill2 which was referred to   
the ,committee on ,ways and ,means  ,a  
,,bill  ,to amend the ,internal ,revenue
 ,code of #aihf to modify the residence 
and source rules to provide for economic
 recovery in the possessions of the     
,united ,states4  #a4 ,short title ,this
 ,act may be cited as the ,territorial  
,tax ,equity and ,economic ,growth ,act 
of #bjai4  #b4 ,modification to         
residence and source rules involving    
possessions  7a7 ,bona fide resident    
,section #icg7;a7 of the ,internal      
,revenue ,code of #aihf is amended--    
7#a7 by striking the last sentence1 and 
7#b7 by amending paragraph 7#a7 to read 
as follows3  7#a7 who has a substantial 
presence 7determined under the          
principles of section #ggja7;b77#c77;,a7
 7applied by substituting #abb days for 
#ca days in clause 7i7 thereof7 without 

regard to sections #ggja7;b77#c77;,b71  
7,c71 and 7,d77 during the taxable year 
in ,guam1 ,american ,samoa1 the         
,northern ,mariana ,islands1 ,puerto    
,rico1 or the ,virgin ,islands1 as the  
case may be1 and  4  7b7 ,source rules  
,section #icg7;b7 of such ,code is      
amended-- 7#a7 in paragraph 7#a71 by    
striking and at the end1  7#b7 in       
paragraph 7#b71 by striking the period  
at the end and inserting 1 but only to  
the extent such income is attributable  
to an office or fixed place of business 
within the ,united ,states 7determined  
under the rules of ,section             
#hfd7;c77#e7711 and  7#c7 by adding at  
the end the following new paragraphs3   
7#c7 for purposes of paragraph 7#a71 the
 principles of section #hfd7;c77#b71    
rather than rules similar to the rules  
in section #hfd7;c77#d71 shall apply for
 purposes of determining whether income 
from sources without a possession       
specified in subsection 7a77#a7 is      
effectively connected with the conduct  

of a trade or business within such      
possession1 and  7#d7 for purposes of   
paragraph 7#b71 income from activities  
within the ,united ,states which are of 
a preparatory or auxiliary character    
shall not be treated as income from     
sources within the ,united ,states or as
 effectively connected with the conduct 
of a trade or business within the       
,united ,states4  4  7c7 ,source rules  
for personal property sales ,section    
#hfe7;j77#c7 of such ,code is amended by
 inserting 1 #icb1 after #ica4  7d7     
,effective date ,the amendments made by 
this section shall apply to taxable     
years beginning after ,december #ca1    
#bjah4