The idea of allowing companies a short-term opportunity to
repatriate overseas earnings at a reduced rate has gained momentum
as a possible revenue offset for highway spending.
Senate Majority Leader Harry Reid, D-Nev., and Sen. Rand Paul,
R-Ky., have been discussing a potential compromise on repatriation
and have promoted the idea as a means to pay for transportation
funding. The transportation trust fund is scheduled to run out of
funding this summer, and tax writers need to raise about $90
billion to fund a reauthorization for six years.
Congress last enacted a temporary repatriation holiday in 2004
when it created Section 965 to allow companies a one-time
opportunity to bring back offshore profits at an effective rate of
5.25%. Since then, the idea of repeating a similar holiday has been
proposed by members of both parties, but top tax writers have
strongly opposed addressing the issue outside of tax reform.
