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Congress·In Committee·21 days ago

Senate Bill Would Ban Tax-Dodging "Inverted" Companies From Federal Contracts

Also known as: American Business for American Companies Act of 2026

Legislative Progress

✓ Filed
Review
Senate
House
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Impact Analysis

Scores: 1 = low, 5 = highSentiment: -5 to +5 (net benefit)

Key Points

  • This bill stops the federal government from giving contracts to "inverted" companies. These are businesses that move their legal address to a foreign country, often to pay lower taxes, even though they still do most of their business or have most of their owners in the United States.
  • The rule would apply to both regular government agencies and the Department of Defense. It also prevents large contractors from hiring these overseas-based companies as major subcontractors on projects worth more than $10 million.
  • A company is considered "inverted" if more than 50% of its stock is still held by the original American owners or if its top bosses are still based in the U.S. and at least 25% of its employees, assets, or income are tied to America.
  • Government leaders could only ignore this rule if it is necessary for national security or to keep important health programs running. If they do grant a waiver, they must tell Congress within 14 days.
  • Companies that break these rules could have their government contracts canceled and might be banned from doing business with the government in the future.
Economy FinanceNational Security Foreign PolicyTaxes

Milestones

2 milestones2 actions
Feb 9, 2026Senate

Read twice and referred to the Committee on Homeland Security and Governmental Affairs. (text: CR S535-537)

Feb 9, 2026

Introduced in Senate

Related News

3 articles
Bloomberg Law·21 days ago

Democrats Introduce Measure to Ban Federal Contracts for Inverted Corporations

Democratic lawmakers on February 9 reintroduced the American Business for American Companies Act, which would permanently bar federal agencies from awarding contracts to 'inverted' corporations that shift their legal headquarters abroad to avoid U.S. taxes.

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RiverBender·19 days ago

Durbin, Reed, Delauro Introduce American Business For American Companies Act

U.S. Senate Democratic Whip Dick Durbin and colleagues reintroduced legislation to extend the ban on federal contracts for inverted corporations by moving it into permanent law and closing loopholes used by dozens of companies to move tax addresses overseas.

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RiverBender·18 days ago

Durbin, Others, Introduce Bill To Stop Tax Dodging Schemes

Alongside the American Business for American Companies Act, lawmakers introduced the Stop Corporate Inversions Act of 2026 to treat combined foreign corporations as domestic if they are still managed in the U.S. or if former U.S. owners hold more than 50 percent of the stock.

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Source Information

Document Type

Congressional Bill

Official Title

American Business for American Companies Act of 2026

Bill NumberS 3811
Congress119th Congress
ChamberSenate
Latest ActionRead twice and referred to the Committee on Homeland Security and Governmental Affairs. (text: CR S535-537)

Sponsor

Cosponsors

(4)
D: 3I: 1

Analysis generated by AI. While we strive for accuracy, this should not be considered legal or professional advice. Always verify information with official government sources.