HR 858 — REVIVE VI Act

Summary

Restore Economic Vitality and Investment in the Virgin Islands Act or the REVIVE VI ActThis 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 iscompensation 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, andeffectively 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.

Bill Text

• Introduced Introduced in House Current html January 31, 2025

AI-generated reading aid from the bill's amendatory text — verify against the official bill.

This bill amends the Internal Revenue Code to exclude certain income derived from services performed in the Virgin Islands when determining global intangible low-taxed income.

• Section 951A(c)(2)(A)(i)

  and → , and

  It adds a conjunction to the list of items in the section.

• Section 951A(c)(2)(A)(i)

  . → , and

  It extends the list of criteria by linking them with a conjunction.

• Section 951A(c)(2)(A)(i)

  (VI) in the case of any specified United States shareholder, any qualified Virgin Islands services income.

  It adds a new criterion for determining global intangible low-taxed income regarding Virgin Islands services.

• Section 951A(c)(2)

  (C) Provisions related to qualified virgin islands services income.--For purposes of subparagraph (A)(i)(VI)--

  It introduces a new subparagraph defining 'qualified Virgin Islands services income'.

• Section 951A(c)(2)(C)(i)

  Qualified virgin islands services income.--The term `qualified Virgin Islands services income' means any gross income which satisfies all of the following requirements:

  It defines what constitutes 'qualified Virgin Islands services income'.

• Section 951A(c)(2)(C)(i)

  (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.

  It specifies that the services must be performed by a qualified Virgin Islands corporation.

• Section 951A(c)(2)(C)(i)

  (II) Such gross income is attributable to services performed from within the Virgin Islands by individuals for the benefit of such corporation.

  It requires that income must be attributable to services performed for the corporation.

• Section 951A(c)(2)(C)(i)

  (III) Such gross income is effectively connected with the conduct of a trade or business within the Virgin Islands.

  It states that the income must be effectively connected to business conducted in the Virgin Islands.

• Section 951A(c)(2)(C)(ii)

  Specified united states shareholder.--The term `specified United States shareholder' means any United States shareholder which is--

  It defines who qualifies as a 'specified United States shareholder'.

• Section 951A(c)(2)(C)(ii)

  (I) an individual, trust, or estate, or

  It specifies types of entities that can be classified as 'specified United States shareholders'.

• Section 951A(c)(2)(C)(ii)

  (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.

  It establishes conditions under which a corporation can be a specified shareholder for tax purposes.

• Section 951A(c)(2)(C)(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.

  It grants authority to the Secretary to create regulations regarding the appropriate application of these new provisions.

• 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.

  It sets the effective date for the amendments outlined in the bill.

Action History

1. January 31, 2025

   Introduced in House

2. January 31, 2025

   Introduced in House

3. January 31, 2025

   Referred to the House Committee on Ways and Means.

Sponsors

• Ron Estes · Primary
• Stacey E. Plaskett · Cosponsor
• Kevin Hern · Cosponsor
• Terri A. Sewell · Cosponsor
• Randy Feenstra · Cosponsor
• Bradley Scott Schneider · Cosponsor
• Carol D. Miller · Cosponsor
• Max L. Miller · Cosponsor
• Suzan K. DelBene · Cosponsor

Subjects