Pay What You Owe Before You Go Act

“(g) Recapture of tax on unrepatriated earnings

“(1) In general—The subpart F income of any applicable controlled foreign corporation for its last taxable year ending before the acquisition date shall be increased by the accumulated deferred foreign income of the corporation.

“(2) Applicable controlled foreign corporation—For purposes of this subsection—

“(A) In general—The term applicable controlled foreign corporation means any controlled foreign corporation with respect to which—

“(i) a covered entity was a United States shareholder at any time during the 5-year period ending on the acquisition date, or

“(ii) a member of the same expanded affiliated group as a covered entity was a United States shareholder at any time during the 5-year period ending on the acquisition date.

“(B) Covered entity—The term covered entity means, with respect to a controlled foreign corporation, any entity which—

“(i) is treated as a surrogate foreign corporation under subsection (a)(2)(B), determined—

“(I) by substituting “September 18, 2014” for “March 4, 2003” each place it appears,

“(II) by substituting “more than 50 percent” for “at least 60 percent” in clause (ii) thereof, and

“(III) by disregarding clause (iii) thereof, and

“(ii) is not treated as a domestic corporation by reason of subsection (b).

“(3) Accumulated deferred foreign income—For purposes of this section—

“(A) In general—The term accumulated deferred foreign income means the excess of—

“(i) the undistributed earnings of the controlled foreign corporation, over

“(ii) the undistributed U.S. earnings of such controlled foreign corporation.

“(B) Undistributed earnings—The term undistributed earnings means the earnings and profits of the controlled foreign corporation described in section 959(c)(3), determined—

“(i) as of the close of the taxable year described in paragraph (1),

“(ii) without diminution by reason of distributions made during such taxable year, and

“(iii) without regard to this subsection.

“(C) Undistributed U.S. earnings—The term undistributed U.S. earnings has the meaning given the term post-1986 undistributed U.S. earnings in section 245(a)(5), determined—

“(i) as of the close of the taxable year described in paragraph (1), and

“(ii) without regard to “post-1986” each place it appears in the matter before subparagraph (A).

“(4) Acquisition date—For purposes of this section, the term acquisition date means the date the covered entity completes the acquisition described in subsection (a)(2)(B)(i) (after the application of paragraph (2)(B)(i) of this subsection).”