The Stop Subsidizing Million Dollar Corporate Bonuses Act

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Section 1. Short title

The bill shall be cited as the "Stop Subsidizing Million Dollar Corporate Bonuses Act".

SEC. 2. Findings and purpose

(a) Findings — Congress finds that:

• there have been numerous instances in which publicly traded companies have paid millions of dollars in bonuses to their executives despite losing money for the company;
• the payment of such bonuses is often not tied to performance metrics or other measurable criteria;
• the payment of such bonuses can be detrimental to the long-term success of the company; and
• congressional oversight of corporate governance has been inadequate.

(b) Purpose — The purpose of this Act is to ensure that publicly traded companies pay their executives based on performance metrics rather than on a one-year basis.

SEC. 3. Effective date

The amendments made by section 1 shall apply to taxable years beginning after December 31, 2024.

SEC. 4. Definitions

(a) In general — For purposes of this Act:

• Publicly traded company means a corporation that is listed on any national securities exchange.
• Executive compensation includes any form of payment or benefit received by an officer, director, employee, or independent contractor from the publicly traded company for services performed for the company.

(b) Publicly held corporation — The term "publicly held corporation" has the meaning given such term in section 12(d) of the Securities Exchange Act of 1934.

SEC. 5. Modifications to definitions

(a) In general — Section 162(m) of the Internal Revenue Code of 1986 is amended by—

• Inserting "with respect to any taxable year" after "means"
• inserting "(B) that was required to file reports under section 15(d) of such Act (15 U.S.C. 78o(d)) at any time during the 3-taxable year period ending with such taxable year."

(b) Regulations

(A) Reporting requirements: The Secretary may prescribe rules and regulations to carry out the purposes of this section, including rules—

• Requiring publicly traded companies to disclose executive compensation in a consistent manner.
• Providing guidance on how publicly traded companies can comply with this subsection.

(B) Avoidance of the purposes of this section: The Secretary may prescribe rules and regulations to carry out the purposes of this section, including rules—

• Preventing publicly traded companies from providing executive compensation through a pass-through or other entity.
• Providing guidance on how publicly traded companies can comply with this subsection.

SEC. 6. Conforming amendments

(a) Heading for section 162(m): The heading for section 162(m) of the Internal Revenue Code of 1986 is amended by striking "Employee".

(b) Heading for section 162(m)(4): The heading for section 162(m)(4) is amended by striking "Employee".