Congress targets corporate tax dodge: closing the round-trip loophole

What it does

This bill closes a tax loophole that allows U.S. corporations with foreign subsidiaries to reduce their U.S. tax liability by routing income through foreign entities and back to the U.S. in ways that minimize taxation. It does this by modifying how the IRS calculates "global intangible low-taxed income" (GILTI) — a key metric in the 2017 Tax Cuts and Jobs Act — to exclude income that has been "round-tripped" (sent abroad and brought back). The bill benefits ordinary taxpayers and the U.S. Treasury by closing a corporate tax avoidance strategy; it costs multinational corporations that currently exploit this loophole.

Why we flagged it

The bill's operative mechanism is to close a specific tax avoidance loophole by redefining how GILTI is calculated. It is not a broad tax reform but a targeted enforcement measure against a known corporate tax strategy.

What the text implies

• The 'round-tripping ratio' mechanism may create significant compliance and audit complexity for multinational corporations, requiring detailed documentation of foreign income sources and use of property — increasing IRS enforcement costs and corporate tax-compliance costs.
• The $100 million gross-receipts threshold for the small-business exemption may create a cliff effect where corporations just above that threshold face sudden material tax increases, potentially incentivizing artificial restructuring to stay below the threshold.
• The bill's reliance on the Secretary of the Treasury to determine 'foreign use' of property and whether services are provided to foreign persons creates substantial discretionary authority and potential for disputes over factual determinations.

Section numbers refer to the bill text the analysis read — linked under Primary records below.

Who it affects

The bill increases tax revenue from multinational corporations that exploit round-tripping strategies, reducing the tax burden on ordinary individuals and small businesses. It does not restrict any citizen rights or protections; it only narrows a corporate tax avoidance mechanism. The $100 million small-business exemption ensures smaller enterprises are not caught by the rule.

Who stands to gain

• U.S. Treasury (increased tax revenue)
• Individual taxpayers (reduced relative tax burden)

Named in the bill

Internal Revenue Service (IRS), U.S. Treasury, Multinational corporations, Controlled foreign corporations (CFCs), U.S. shareholders of foreign entities

Where it stands

3 cosponsors: 3 Democrats.

• Jun 11, 2025 — Introduced · Congress.gov: “Introduced in Senate”
• Jun 11, 2025 — Referred to Senate Committee on Finance · Congress.gov: “Read twice and referred to the Committee on Finance”

Dates and quoted wording are Congress.gov's action record; the timeline shows status changes, not every procedural step.

Money around this bill

3 lobbying clients named this bill on 5 disclosure filings across 3 quarters, Sep 2025 to Jun 2026. Those filings disclosed $210,000 in lobbying spend. A filing names 4 bills on average, so that figure is what each filing reported, not a share belonging to this bill.

More lobbying clients named this bill than 61% of bills with at least one filing.

Ron Wyden, the sponsor, reported $349,070 in PAC receipts in the 2026 cycle.

• Elekta, Inc. — $140,000 on 2 filings
• Alliance for Biopharmaceutical Competitiveness and Innovation — $70,000 on 1 filing
• Small Business Majority Foundation, Inc. — $0 on 2 filings

Lobbying Disclosure Act filings through Jul 10, 2026. A filing shows who paid to lobby on a bill it names, not what changed.