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To amend the Internal Revenue Code of 1986 to provide special rules for purposes of determining if financial guaranty insurance companies are qualifying insurance corporations under the passive foreign investment company rules.

USA119th CongressHR-2567| House 
| Updated: 4/1/2025
Gwen Moore

Gwen Moore

Democratic Representative

Wisconsin

Cosponsors (1)
Adrian Smith (Republican)

Ways and Means Committee

  • Introduced
  • In Committee
  • On Floor
  • Passed Chamber
  • Enacted
The bill amends the Internal Revenue Code of 1986 to create specific criteria for financial guaranty insurance companies to be classified as "qualifying insurance corporations" and thus avoid passive foreign investment company (PFIC) status. This aims to prevent certain foreign financial guarantors from being inadvertently penalized by PFIC rules. It introduces new provisions within Section 1297(f)(3) to address the unique nature of these companies' liabilities. Under these new rules, a financial guaranty insurance company's applicable insurance liabilities will include its unearned premium reserves , provided certain conditions are met. These conditions include adherence to generally accepted accounting principles regarding loss reserves, and meeting specific financial guaranty exposure ratios (e.g., 15-to-1) or State/local bond exposure ratios (e.g., 9-to-1) as reported on their financial statements. The inclusion of these reserves is limited to insurance within single risk limits defined by the Financial Guaranty Insurance Guideline. Furthermore, the bill clarifies reporting requirements for financial statements and grants the Secretary of the Treasury authority to mandate information reporting from U.S. persons holding interests in certain non-publicly traded foreign corporations that claim non-PFIC status. The amendments are generally effective for taxable years beginning after December 31, 2024. A significant provision offers a specified grace period for qualified financial guaranty insurance companies, preventing them from being treated as PFICs for taxable years between December 31, 2017, and January 1, 2025, if they would have met the new criteria. This retroactive relief aims to address past classifications.
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Timeline

Bill from Previous Congress

HR 116-5746
To amend the Internal Revenue Code of 1986 to provide special rules for purposes of determining if financial guaranty insurance companies are qualifying insurance corporations under the passive foreign investment company rules.

Bill from Previous Congress

HR 117-4422
To amend the Internal Revenue Code of 1986 to provide special rules for purposes of determining if financial guaranty insurance companies are qualifying insurance corporations under the passive foreign investment company rules.

Bill from Previous Congress

HR 118-3105
To amend the Internal Revenue Code of 1986 to provide special rules for purposes of determining if financial guaranty insurance companies are qualifying insurance corporations under the passive foreign investment company rules.
Apr 1, 2025
Introduced in House
Apr 1, 2025
Referred to the House Committee on Ways and Means.
Jun 9, 2025

Latest Companion Bill Action

S 119-1987
Introduced in Senate
  • Bill from Previous Congress

    HR 116-5746
    To amend the Internal Revenue Code of 1986 to provide special rules for purposes of determining if financial guaranty insurance companies are qualifying insurance corporations under the passive foreign investment company rules.


  • Bill from Previous Congress

    HR 117-4422
    To amend the Internal Revenue Code of 1986 to provide special rules for purposes of determining if financial guaranty insurance companies are qualifying insurance corporations under the passive foreign investment company rules.


  • Bill from Previous Congress

    HR 118-3105
    To amend the Internal Revenue Code of 1986 to provide special rules for purposes of determining if financial guaranty insurance companies are qualifying insurance corporations under the passive foreign investment company rules.


  • April 1, 2025
    Introduced in House


  • April 1, 2025
    Referred to the House Committee on Ways and Means.


  • June 9, 2025

    Latest Companion Bill Action

    S 119-1987
    Introduced in Senate

Taxation

Related Bills

  • S 119-1987: A bill to amend the Internal Revenue Code of 1986 to provide special rules for purposes of determining if financial guaranty insurance companies are qualifying insurance corporations under the passive foreign investment company rules.

To amend the Internal Revenue Code of 1986 to provide special rules for purposes of determining if financial guaranty insurance companies are qualifying insurance corporations under the passive foreign investment company rules.

USA119th CongressHR-2567| House 
| Updated: 4/1/2025
The bill amends the Internal Revenue Code of 1986 to create specific criteria for financial guaranty insurance companies to be classified as "qualifying insurance corporations" and thus avoid passive foreign investment company (PFIC) status. This aims to prevent certain foreign financial guarantors from being inadvertently penalized by PFIC rules. It introduces new provisions within Section 1297(f)(3) to address the unique nature of these companies' liabilities. Under these new rules, a financial guaranty insurance company's applicable insurance liabilities will include its unearned premium reserves , provided certain conditions are met. These conditions include adherence to generally accepted accounting principles regarding loss reserves, and meeting specific financial guaranty exposure ratios (e.g., 15-to-1) or State/local bond exposure ratios (e.g., 9-to-1) as reported on their financial statements. The inclusion of these reserves is limited to insurance within single risk limits defined by the Financial Guaranty Insurance Guideline. Furthermore, the bill clarifies reporting requirements for financial statements and grants the Secretary of the Treasury authority to mandate information reporting from U.S. persons holding interests in certain non-publicly traded foreign corporations that claim non-PFIC status. The amendments are generally effective for taxable years beginning after December 31, 2024. A significant provision offers a specified grace period for qualified financial guaranty insurance companies, preventing them from being treated as PFICs for taxable years between December 31, 2017, and January 1, 2025, if they would have met the new criteria. This retroactive relief aims to address past classifications.
View Full Text

Suggested Questions

Get AI-generated questions to help you understand this bill better

Timeline

Bill from Previous Congress

HR 116-5746
To amend the Internal Revenue Code of 1986 to provide special rules for purposes of determining if financial guaranty insurance companies are qualifying insurance corporations under the passive foreign investment company rules.

Bill from Previous Congress

HR 117-4422
To amend the Internal Revenue Code of 1986 to provide special rules for purposes of determining if financial guaranty insurance companies are qualifying insurance corporations under the passive foreign investment company rules.

Bill from Previous Congress

HR 118-3105
To amend the Internal Revenue Code of 1986 to provide special rules for purposes of determining if financial guaranty insurance companies are qualifying insurance corporations under the passive foreign investment company rules.
Apr 1, 2025
Introduced in House
Apr 1, 2025
Referred to the House Committee on Ways and Means.
Jun 9, 2025

Latest Companion Bill Action

S 119-1987
Introduced in Senate
  • Bill from Previous Congress

    HR 116-5746
    To amend the Internal Revenue Code of 1986 to provide special rules for purposes of determining if financial guaranty insurance companies are qualifying insurance corporations under the passive foreign investment company rules.


  • Bill from Previous Congress

    HR 117-4422
    To amend the Internal Revenue Code of 1986 to provide special rules for purposes of determining if financial guaranty insurance companies are qualifying insurance corporations under the passive foreign investment company rules.


  • Bill from Previous Congress

    HR 118-3105
    To amend the Internal Revenue Code of 1986 to provide special rules for purposes of determining if financial guaranty insurance companies are qualifying insurance corporations under the passive foreign investment company rules.


  • April 1, 2025
    Introduced in House


  • April 1, 2025
    Referred to the House Committee on Ways and Means.


  • June 9, 2025

    Latest Companion Bill Action

    S 119-1987
    Introduced in Senate
Gwen Moore

Gwen Moore

Democratic Representative

Wisconsin

Cosponsors (1)
Adrian Smith (Republican)

Ways and Means Committee

Taxation

Related Bills

  • S 119-1987: A bill to amend the Internal Revenue Code of 1986 to provide special rules for purposes of determining if financial guaranty insurance companies are qualifying insurance corporations under the passive foreign investment company rules.
  • Introduced
  • In Committee
  • On Floor
  • Passed Chamber
  • Enacted