Stop Corporate Inversions Act of 2026

Source of recordUS Congress · congress.govLast synced Jul 10, 2026

Chamber

Senate

Progress

Where this bill stands in the legislative process.

Introduced
Passed Senate
Passed House
To President
Became Law

Overview

The Stop Corporate Inversions Act of 2026 aims to prevent companies from relocating their headquarters to lower-tax jurisdictions through a process called ‘inversion.’ Specifically, it modifies how the Internal Revenue Code treats foreign corporations that acquire domestic businesses, aiming to ensure that companies with significant operations within the United States are not considered ‘inverted’ and therefore subject to different tax rules. The bill focuses on determining whether a foreign corporation’s management and control are primarily located in the U.S., and whether it has substantial domestic business activities.

Key provisions

Reclassifies foreign corporations that complete acquisitions after May 8, 2014, as ‘inverted domestic corporations’ if they meet certain criteria related to stock ownership or management control.
Establishes a threshold of 25% for employee base, compensation, assets, and income within the U.S. to determine ‘significant domestic business activities’.
Defines ‘inverted domestic corporation’ based on stock ownership by former shareholders or partners, and the location of management and control.
Requires the Secretary of the Treasury to issue regulations clarifying how management and control are determined.
Provides an exception for foreign corporations with substantial business activities in the country where they were originally established.
Modifies the effective date of certain tax rules to align with the date of the bill's enactment.
Includes conforming amendments to the Internal Revenue Code to reflect the changes in treatment of inverted corporations.