Treatment of Certain Possessions
[Pub. L. 117–2, title IX, § 9601(b)], Mar. 11, 2021, [135 Stat. 142], provided that:“(1)
Payments to possessions with mirror code tax systems.—
The Secretary of the Treasury shall pay to each possession of the United States which has a mirror code tax system amounts equal to the loss (if any) to that possession by reason of the amendments made by this section. Such amounts shall be determined by the Secretary of the Treasury based on information provided by the government of the respective possession.
“(2)
Payments to other possessions.—
The Secretary of the Treasury shall pay to each possession of the United States which does not have a mirror code tax system amounts estimated by the Secretary of the Treasury as being equal to the aggregate benefits (if any) that would have been provided to residents of such possession by reason of the amendments made by this section if a mirror code tax system had been in effect in such possession. The preceding sentence shall not apply unless the respective possession has a plan, which has been approved by the Secretary of the Treasury, under which such possession will promptly distribute such payments to its residents.
“(3)
Inclusion of administrative expenses.—
The Secretary of the Treasury shall pay to each possession of the United States to which the Secretary makes a payment under paragraph (1) or (2) an amount equal to the lesser of—
“(A)
the increase (if any) of the administrative expenses of such possession—
“(i)
in the case of a possession described in paragraph (1), by reason of the amendments made by this section, and
“(ii)
in the case of a possession described in paragraph (2), by reason of carrying out the plan described in such paragraph, or
“(B)
$500,000 ($10,000,000 in the case of Puerto Rico).
The amount described in subparagraph (A) shall be determined by the Secretary of the Treasury based on information provided by the government of the respective possession.
“(4)
Coordination with credit allowed against united states income taxes.—
No credit shall be allowed against United States income taxes under section 6428B of the Internal Revenue Code of 1986 (as added by this section), nor shall any credit or refund be made or allowed under subsection (g) of such section, to any person—
“(A)
to whom a credit is allowed against taxes imposed by the possession by reason of the amendments made by this section, or
“(B)
who is eligible for a payment under a plan described in paragraph (2).
“(5)
Mirror code tax system.—
For purposes of this subsection, the term ‘mirror code tax system’ means, with respect to any possession of the United States, the income tax system of such possession if the income tax liability of the residents of such possession under such system is determined by reference to the income tax laws of the United States as if such possession were the United States.
“(6)
Treatment of payments.—
For purposes of
section 1324 of title 31, United States Code, the payments under this subsection shall be treated in the same manner as a refund due from a credit provision referred to in subsection (b)(2) of such section.”
Exception From Reduction or Offset
[Pub. L. 117–2, title IX, § 9601(c)(2)], Mar. 11, 2021, [135 Stat. 143], provided that: “Any refund payable by reason of section 6428B(g) of the Internal Revenue Code of 1986 (as added by this section), or any such refund payable by reason of subsection (b) of this section [set out above], shall not be—“(A)
subject to reduction or offset pursuant to subsection (c), (d), (e), or (f) of section 6402 of the Internal Revenue Code of 1986 or any similar authority permitting offset, or
“(B)
reduced or offset by other assessed Federal taxes that would otherwise be subject to levy or collection.”