Stop Subsidizing Multimillion Dollar Corporate Bonuses Act

This bill aims to significantly expand the denial of tax deductions for excessive executive remuneration by amending Section 162(m) of the Internal Revenue Code. It broadens the scope of individuals and entities subject to the existing $1 million deduction limit on compensation for publicly held corporations. A key provision redefines "covered individual" to include any individual who performs services for a taxpayer, not just employees, for tax years beginning after December 31, 2020. This change ensures that once an individual is deemed "covered," they remain subject to the deduction limitation indefinitely. Furthermore, the bill expands the definition of a "publicly held corporation" to include those required to file reports under Section 15(d) of the Securities Exchange Act of 1934 during a three-year period, thereby encompassing more entities. The legislation also grants the Secretary of the Treasury new regulatory authority to issue guidance and rules necessary to carry out its purposes and prevent avoidance, including through pass-through entities. These amendments are slated to apply to taxable years beginning after December 31, 2024.