HIRE Act

Specifically, the excise tax applies to outsourcing payments, which the bill defines as any premium, fee, royalty, service charge, or other payment made

in the course of a trade or business,

to a foreign person (excluding a corporation or partnership organized under the laws of the United States or a U.S. possession), and

for labor or services which benefit (directly or indirectly) U.S. consumers.

Further, a federal tax deduction is not allowed for outsourcing payments or the excise tax on such payments.

Under the bill, the Internal Revenue Service may require persons to report information related to outsourcing payments. The bill imposes penalties for failing to report such information or pay the excise tax.

The bill also establishes and provides funding for the Domestic Workforce Fund, which is to be used for

workforce development and retraining programs,

apprenticeship programs and partnerships with industry to expand domestic employment in sectors impacted by outsourcing, and

state grants for workforce development for communities with high levels of job displacement.

The funding provided by the bill for the Domestic Workforce Fund is equivalent to the amounts received from the tax and penalties imposed by the bill.