To amend the Internal Revenue Code of 1986 to deny deduction for outsourcing payments.

Key Provisions

• Blocks businesses from deducting certain payments made to foreign companies for services used by U.S. consumers.
• Defines 'outsourcing payment' to include fees, royalties, or service charges paid to foreign persons for services benefiting U.S. consumers.
• Sets a formula for payments that cover services for both U.S. and non-U.S. consumers, only denying deductions for the U.S.-related portion.
• Clarifies that a 'foreign person' is anyone not a U.S. person, excluding companies from U.S. possessions.
• Gives the Treasury Secretary power to create rules to prevent businesses from avoiding these new tax changes.