The Corporate Tax Dodging Prevention Act would make several major changes to how the United States taxes corporations, particularly multinational companies. The bill restores a progressive corporate tax rate structure starting at 15 percent for the first $50,000 of income and reaching 35 percent for income over $10 million, effective for tax years beginning after December 31, 2024. It also eliminates tax benefits that allow companies to defer taxes on foreign income by requiring all income earned by foreign subsidiaries to be taxed immediately, and it repeals the deduction for foreign-derived intangible income that currently allows companies to reduce taxes on offshore profits. Additionally, the bill tightens rules on corporate inversions (when U.S. companies relocate overseas) by lowering the ownership threshold from 60 percent to 50 percent, treats foreign corporations managed and controlled in the United States as domestic corporations, and restricts interest deductions for multinational companies and treaty-based tax benefits for certain payments between related parties. Most provisions take effect in 2025, affecting all U.S. corporations and multinational companies with U.S. operations.
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