WASHINGTON – Arizona senior Senator Kyrsten Sinema partnered with Republican Senator Mike Braun (Ind.) to introduce legislation fixing how the tax code treats transition taxes. The bill provides clarity for Arizona businesses on tax payments of overseas earnings and ensures job creators can continue to re-invest in their businesses and grow Arizona’s economy.
“Arizona businesses deserve a tax code that is straightforward, fair, and supports job growth. Our bipartisan legislation ensures Arizona businesses can plan for the future and create more jobs for hard-working Arizonans,” said Sinema.
The 2017 Tax Cuts and Jobs Act, created a new transition tax to ensure corporations meet their U.S. tax obligations on overseas earnings. However, the Internal Revenue Service issued two conflicting sets of rules that created confusion and forced taxpayers to apply tax refunds and overpayments to pay the transition tax, against clear Congressional intent.
Sinema’s bill fixes IRS practices that contradict U.S. tax policy and Congressional intent regarding transition taxes, also known as Section 965 payments. Sinema took action after hearing from Arizona businesses about how current IRS policy hinders their ability to grow, hire new workers, and invest in research and development.
