“To amend the Internal Revenue Code of 1986 to establish the individual tariff refund credit.”
No CRS summary available for this bill.
This section establishes a new refundable tax credit under IRC §6436 (individual tariff refund credit) for eligible individuals (i.e., U.S. resident individuals who are not dependents, nonresident aliens, estates, or trusts as of a covered court order date) equal to such individual's pro rata share—based on household size (1 or 2 for the taxpayer plus dependents)—of aggregate tariff revenues that a final court order requires the federal government to repay due to an unlawfully imposed tariff after January 20, 2025, and before enactment. The credit applies to the eligible individual's most recent tax year ending before the court order and is allowable as an advance refund (treated as a tax payment with rapid issuance, no interest, and notice to recipients); any excess advance refunds reduce later credit claims. This section further (1) authorizes disbursements for §6436 refunds from the existing permanent Treasury appropriation for IRS refunds under 31 U.S.C. §1324(b) (by adding §6436 to the list of specified credits); (2) includes §6436 within the IRC §6211 definition of deficiency; and (3) directs the Treasury Secretary to pay U.S. possessions amounts equal to mirrored tax system losses or estimated resident benefits (with approved distribution plans for non-mirror systems), including administrative expenses.
This section establishes an excise tax equal to 100% of non-qualifying tariff refunds (i.e., repayments of tariff revenues collected from the taxpayer pursuant to a covered court order) received after December 31, 2025, by covered taxpayers (i.e., corporations or other taxpayers with more than $1 billion in gross receipts). The tax does not apply if the taxpayer demonstrates that price increases for its products during the covered period—beginning January 20, 2025, and ending on the date of the covered court order—did not exceed 50% of tariffs imposed on production inputs, disregarding any portion attributable to inflation. (Thus, large businesses receiving court-ordered tariff refunds must generally repay the full amount to the Treasury unless they prove limited pass-through to consumers.)