,i  #aag? ,,congress  #b;d ,session  ,h4
 ,r4 #heei  ,,9 ,,! ,,h\se ,,(          
,,repres5tatives  ,july #bh1 #bjbb,ms4  
,craig introduc$ ! foll[+ bill2 :i* 0   
ref]r$ to ! ,committee on ,ways & ,means
  ,a ,,bill  ,to am5d ! ,int]nal ,rev5ue
 ,code ( #aihf to provide tax relief =  
c]ta9 small bus9ess own]s1 to impose a  
tax on ! repur*ase ( corporate /ock1 & =
 o!r purposes4  #a4 ,%ort title ,?is    
,act may be cit$ z ! ,small ,bus9ess    
,own] ,tax ,relief ,act ( #bjbb4  #b4   
,enhanc$ d$uction = c]ta9 self-employ$  
individuals  7a7 ,9 g5]al ,section      
#afd7;f7 ( ! ,int]nal ,rev5ue ,code (   
#aihf is am5d$ by add+ at ! end ! foll[+
 new p>agraph3  7#c7 ,enhanc$ d$uction =
 l[]-income individuals ,9 ! case ( an  
individual ) a gross income ( less ?an  
#djj1jjj = ! taxable ye>1 p>agraph 7#a7 
%all be appli$ by sub/itut+ ?ree qu>t]s 
( ! taxes impos$ = "o-half ( ! taxes    
impos$4  4  7b7 ,effective date ,!      
am5dm5t made by ?is section %all apply  
to taxable ye>s beg9n+ aft] ,decemb]    

#ca1 #bjba4  #c4 ,excise tax on         
repur*ase ( corporate /ock  7a7 ,9 g5]al
 ,subtitle ,d is am5d$ by ins]t+ aft]   
*apt] #cf ! foll[+ new *apt]3  #cg      
,repur*ase ( corporate /ock  ,sec4      
#deja4 ,repur*ase ( corporate /ock4     
#deja4 ,repur*ase ( corporate /ock  7a7 
,g5]al rule ,!re is h]eby impos$ on ea* 
cov]$ corporation a tax equal to #j4h   
p]c5t ( ! fair m>ket value ( any /ock ( 
! corporation :i* is repur*as$ by su*   
corporation dur+ ! taxable ye>4  7b7    
,cov]$ corporation ,= purposes ( ?is    
section1 ! t]m cov]$ corporation means  
any dome/ic corporation ! /ock ( :i* is 
trad$ on an e/abli%$ securities m>ket   
7)9 ! mean+ ( section #ggjd7;b77#a774   
7c7 ,repur*ase ,= purposes ( ?is        
section-- 7#a7 ,9 g5]al ,! t]m repur*ase
 means-- 7,a7 a r$emption )9 ! mean+ (  
section #cag7;b7 ) reg>d to ! /ock ( a  
cov]$ corporation1 &  7,b7 any          
transaction det]m9$ by ! ,secret>y to be
 economically simil> to a transaction   
describ$ 9 subp>agraph 7,a74  7#b7      

,treatm5t ( pur*ases by specifi$        
affiliates  7,a7 ,9 g5]al ,! acquisition
 ( /ock ( a cov]$ corporation by a      
specifi$ affiliate ( su* cov]$          
corporation1 f a p]son :o is n ! cov]$  
corporation or a specifi$ affiliate (   
su* cov]$ corporation1 %all be treat$ z 
a repur*ase ( ! /ock ( ! cov]$          
corporation by su* cov]$ corporation4   
7,b7 ,specifi$ affiliate ,= purposes (  
?is section1 ! t]m specifi$ affiliate   
means1 ) respect to any corporation--   
7i7 any corporation m ?an #ej p]c5t ( ! 
/ock ( :i* is own$ 7by vote or by       
value71 directly or indirectly1 by su*  
corporation1 &  7ii7 any p>tn]%ip m ?an 
#ej p]c5t ( ! capital int]e/s or pr(its 
int]e/s ( :i* is held1 directly or      
indirectly1 by su* corporation4  7#c7   
,adju/m5t ,! am\nt tak5 into acc\nt "u  
subsection 7a7 ) respect to any /ock    
repur*as$ by a cov]$ corporation %all be
 r$uc$ by ! fair m>ket value ( any /ock 
issu$ by ! cov]$ corporation dur+ !     
taxable ye>1 includ+ ! fair m>ket value 

( any /ock issu$ to employees ( su*     
cov]$ corporation or a specifi$         
affiliate ( su* cov]$ corporation dur+ !
 taxable ye>1 :e!r or n su* /ock is     
issu$ 9 response to ! ex]cise ( an      
option to pur*ase su* /ock4  7d7        
,special rules = acquisition ( /ock (   
c]ta9 =eign corporations  7#a7 ,9 g5]al 
,9 ! case ( an acquisition ( /ock ( an  
applicable =eign corporation by a       
specifi$ affiliate ( su* corporation    
7o!r ?an a =eign corporation or a =eign 
p>tn]%ip 7unless su* p>tn]%ip has a     
dome/ic entity z a direct or indirect   
p>tn]77 f a p]son :o is n ! applicable  
=eign corporation or a specifi$         
affiliate ( su* applicable =eign        
corporation1 = purposes ( ?is section-- 
7,a7 su* specifi$ affiliate %all be     
treat$ z a cov]$ corporation ) respect  
to su* acquisition1  7,b7 su*           
acquisition %all be treat$ z a repur*ase
 ( /ock ( a cov]$ corporation by su*    
cov]$ corporation1 &  7,c7 ! adju/m5t "u
 subsection 7c77#c7 %all be det]m9$ only

 ) respect to /ock issu$ by su* specifi$
 affiliate to employees ( ! specifi$    
affiliate4  7#b7 ,surrogate =eign       
corporations ,9 ! case ( a repur*ase (  
/ock ( a cov]$ surrogate =eign          
corporation by su* cov]$ surrogate =eign
 corporation1 or an acquisition ( /ock (
 a cov]$ surrogate =eign corporation by 
a specifi$ affiliate ( su* corporation1 
= purposes ( ?is section-- 7,a7 !       
expatriat$ entity ) respect to su* cov]$
 surrogate =eign corporation %all be    
treat$ z a cov]$ corporation ) respect  
to su* repur*ase or acquisition1  7,b7  
su* repur*ase or acquisition %all be    
treat$ z a repur*ase ( /ock ( a cov]$   
corporation by su* cov]$ corporation1 & 
7,c7 ! adju/m5t "u subsection 7c77#c7   
%all be det]m9$ only ) respect to /ock  
issu$ by su* expatriat$ entity to       
employees ( ! expatriat$ entity4  7#c7  
,def9itions ,= purposes ( ?is           
subsection-- 7,a7 ,applicable =eign     
corporation ,! t]m applicable =eign     
corporation means any =eign corporation 

! /ock ( :i* is trad$ on an e/abli%$    
securities m>ket 7)9 ! mean+ ( section  
#ggjd7;b77#a774  7,b7 ,cov]$ surrogate  
=eign corporation ,! t]m cov]$ surrogate
 =eign corporation means any surrogate  
=eign corporation 7z det]m9$ "u section 
#ghgd7;a77#b77;,b7 by sub/itut+         
,septemb] #bj1 #bjba = ,m>* #d1 #bjjc   
ea* place x appe>s7 ! /ock ( :i* is     
trad$ on an e/abli%$ securities m>ket   
7)9 ! mean+ ( section #ggjd7;b77#a771 b 
only ) respect to taxable ye>s :i*      
include any portion ( ! applicable p]iod
 ) respect to su* corporation "u section
 #ghgd7;d77#a74  7,c7 ,expatriat$ entity
 ,! t]m expatriat$ entity has ! mean+   
giv5 su* t]m by section                 
#ghgd7;a77#b77;,a74  7e7 ,exceptions    
,subsection 7a7 %all n apply-- 7#a7 to !
 ext5t t ! repur*ase is "p ( a          
reorganization 7)9 ! mean+ ( section    
#cfh7;a77 & no ga9 or loss is recogniz$ 
on su* repur*ase by ! %>ehold] "u *apt] 
#a by reason ( su* reorganization1  7#b7
 9 any case 9 :i* ! /ock repur*as$ is1  

or an am\nt ( /ock equal to ! value ( ! 
/ock repur*as$ is1 contribut$ to an     
employ]-sponsor$ retirem5t plan1        
employee /ock own]%ip plan1 or simil>   
plan1  7#c7 9 any case 9 :i* ! total    
value ( ! /ock repur*as$ dur+ ! taxable 
ye> does n exce$ #a1jjj1jjj1  7#d7 "u   
regulations prescrib$ by ! ,secret>y1 9 
cases 9 :i* ! repur*ase is by a deal] 9 
securities 9 ! ord9>y c\rse ( bus9ess1  
7#e7 to repur*ases by a regulat$        
inve/m5t company 7z def9$ 9 section     
#hea7 or a real e/ate inve/m5t tru/1 or 
7#f7 to ! ext5t t ! repur*ase is treat$ 
z a divid5d = purposes ( ?is title4  7f7
 ,regulations & guidance ,! ,secret>y   
%all prescribe su* regulations & o!r    
guidance z are necess>y or appropriate  
to adm9i/] & to prev5t ! avoidance ( !  
purposes ( ?is section1 includ+         
regulations & o!r guidance-- 7#a7 to    
prev5t ! abuse ( ! exceptions provid$ by
 subsection 7e71  7#b7 to address       
special classes ( /ock & pref]r$ /ock1 &
  7#c7 = ! application ( ! rules "u     

subsection 7d74  4  7b7 ,tax n d$uctible
 ,p>agraph 7#f7 ( section #bge7;a7 is   
am5d$ by ins]t+ #cg1 be=e #da4  7c7     
,cl]ical am5dm5t ,! table ( *apt]s =    
subtitle ,d is am5d$ by ins]t+ aft] !   
item relat+ to *apt] #cf ! foll[+ new   
item3  ,*apt] #cg--,repur*ase (         
corporate /ock  4  7d7 ,effective date  
,! am5dm5ts made by ?is section %all    
apply to repur*ases 7)9 ! mean+ (       
section #deja7;c7 ( ! ,int]nal ,rev5ue  
,code ( #aihf1 z add$ by ?is section7 ( 
/ock aft] ,decemb] #ca1 #bjba4