# 114-hr-5754: S Corporation Modernization Act of 2016

114-hr-5754, S Corporation Modernization Act of 2016, is a 114th Congress bill sponsored by Rep. Reichert, David G. [R-WA-8] (R-WA); status Referred to the House Committee on Ways and Means. (as of 2025-11-18).

- Canonical: https://policyrisk.com/legislation/114-hr-5754
- As of: 2025-11-18
- Plain-text twin of the page above; the HTML and this file carry the same facts.

## Facts
- Bill: 114-hr-5754
- Congress: 114
- Title: S Corporation Modernization Act of 2016
- Status: Referred to the House Committee on Ways and Means.
- Introduced: 2016-07-13
- Sponsor: Rep. Reichert, David G. [R-WA-8] (R-WA)
- Cosponsors: 3
- Policy area: Taxation
- Touches household money: no
- Last recorded action: 2025-11-18

## Summary

S Corporation Modernization Act of 2016 This bill amends the Internal Revenue Code, with respect to the tax treatment of S corporations, to: allow a nonresident alien to be a qualifying beneficiary of an electing small business trust (ESBT), which is a type of trust that is permitted to hold shares in an S corporation; allow S corporations to increase passive investment income from 25% to 60% without incurring additional taxes; eliminate a provision terminating the S corporation status of corporations with excessive passive income for three consecutive years; allow any S corporation bank to have individual retirement account shareholders; allow ESBTs to claim expanded tax deductions for charitable contributions; and allow an adjustment to the basis of an S corporation's assets upon the death of a shareholder, in the form of a 15-year amortization deduction.

## Cosponsors (3)

- Rep. Kind, Ron [D-WI-3] (D-WI), 2016-07-13T00:00:00.000Z
- Rep. Renacci, James B. [R-OH-16] (R-OH), 2016-09-13T00:00:00.000Z
- Rep. Paulsen, Erik [R-MN-3] (R-MN), 2016-09-13T00:00:00.000Z

## Related bills

- 114-hr-5621: To posthumously award a Congressional Gold Medal to Lawrence Eugene "Larry" Doby in recognition of his achievements and contributions to American major league…
- 114-hr-5447: Small Business Health Care Relief Act of 2016
- 114-hr-5292: Air Traffic Controller Hiring Improvement Act of 2016
- 114-hr-5082: Investing in Opportunity Act
- 114-hr-4938: Free File Act of 2016
- 114-hr-4923: American Manufacturing Competitiveness Act of 2016

## Sources
- [114-hr-5754 on Congress.gov](https://www.congress.gov/bill/114th-congress/house-bill/5754)

## Related
- [114-hr-5621: To posthumously award a Congressional Gold Medal to Lawrence Eugene "Larry" Dob…](https://policyrisk.com/legislation/114-hr-5621)
- [114-hr-5447: Small Business Health Care Relief Act of 2016](https://policyrisk.com/legislation/114-hr-5447)
- [114-hr-5292: Air Traffic Controller Hiring Improvement Act of 2016](https://policyrisk.com/legislation/114-hr-5292)
- [114-hr-5082: Investing in Opportunity Act](https://policyrisk.com/legislation/114-hr-5082)
- [114-hr-4938: Free File Act of 2016](https://policyrisk.com/legislation/114-hr-4938)
- [114-hr-4923: American Manufacturing Competitiveness Act of 2016](https://policyrisk.com/legislation/114-hr-4923)
- [All bills in Congress](https://policyrisk.com/legislation)

Source: PRIA, https://policyrisk.com/legislation/114-hr-5754 (as of 2025-11-18).