When companies such as Cisco Systems, Inc. (Nasdaq: CSCO) and Microsoft Corp. (Nasdaq: MSFT) began issuing debt in the past decade, some investors were left scratching their heads. After all, these companies carried a hefty amount of cash on their balance sheet and seemingly had no use for more money.

#-ad_banner-#The key reason: much of their cash was locked up in foreign banks.

These and many other companies have been playing a waiting game with the U.S. government. The government has sought to tax those foreign-earned funds when they are repatriated back home. For many companies, we’re talking about a tax rate in excess of 30% (offset by any amount of taxes already levied by foreign entities on those earnings). These companies figured they would just bide their time until the government agreed to a lower tax rate.

Well, that time may have finally come. Reports are circulating that the Obama administration, as part of a broad corporate tax overhaul, will offer a lowered tax rate for repatriated funds.

President Obama’s reported opening gambit: a 14% tax rate on cash brought home now and a 19% tax rate on future foreign-sourced profits. Congressional Republicans will likely counter-offer with a lower figure, but a push by the U.S.  Chamber of Commerce to get some sort of deal signed suggests that a deal may be hashed out close to those figures.

(The primary reason the two sides might not come to an agreement is President Obama’s desire to link the agreement to a hike in infrastructure spending, which is also supported by the U.S. Chamber of Commerce, but not by Republican budget hawks.)

How much money are we talking about? More than $2 trillion in cash is parked in offshore accounts, according to Audit Analytics. General Electric Co. (NYSE: GE), Microsoft and Pfizer, Inc. (NYSE: PFE) alone have more than $250 billion stranded elsewhere. Dozens more businesses have at least $10 billion in offshore cash.

When last presented with such an opening, thanks to the American Jobs Creation Act of 2004, companies brought back $362 billion in foreign profits. Since then, companies have amassed even larger cash balances. It’s hard to know how much cash would come back this time, in part because the tax rate is not quite as favorable this time around.

Yet, even if a few hundred billion dollars starts to return to our shores, you can look for some eye-popping share buyback announcements. Some companies, such as International Business Machines Corp. (NYSE: IBM) with $52 billion offshore, have already proven themselves as serial share repurchasers and will be emboldened to stay the course. Other companies, such as Citigroup, Inc. (NYSE: C) with $44 billion offshore, may decide that current offshore cash levels need to stay abroad to support foreign operations.

For the majority of such companies, buybacks and dividends are the likely target for that money. Most major companies have already optimized their balance sheets from a debt-to-equity perspective and continue to rack up hefty annual cash flows. A study by the St. Louis branch of the Federal Reserve found that “by 2011, U.S. firms were holding 4 times as much cash as they were holding in 1995 and 11 times as much as they were holding in 1979.” Since then, the cash balances have grown larger still.

The excess cash, earning just 1% or 2%, can’t just sit there. These companies are under increasing pressure to return that cash to shareholders, unless they want to attract the interest of activist investors like Carl Icahn, who sees cash-rich companies as potential targets.

Although you may hear about dozens of companies initiating or boosting a buyback program if a tax deal is struck, here are three that would see a solid share price boost:

GE. With more than $100 billion in cash tied up offshore, GE a candidate for a few simple reasons. First, shares have lagged the broader market on a one-year, five-year and 10-year basis, placing greater pressure on CEO Jeffrey Immelt to take bolder steps to boost the share price. Second, GE’s foreign cash represents roughly 40% of its current $245 billion market value. To be sure, GE won’t spend $100 billion on buybacks, if this tax deal is approved, but even $20, $30 or $40 billion would provide a solid boost to shares.

Pfizer. This drug maker repatriated $37 billion the last time this tax window opened and has since seen its foreign cash levels swell back to $69 billion. Pfizer has already reduced its share count from 7.9 billion shares at the end of 2011 to a recent 6.4 billion shares and is currently in the midst of another $11 billion plan. By the time that buyback plan is done, look for Pfizer to replace it with a super-sized buyback plan.

Cisco. This tech firm has bought back roughly one billion shares (15%) over the past six years, and with $48 billion parked abroad, representing one-third of its market value, you can expect to see ongoing aggressive buybacks. Cisco typically generates $7-to-$8 billion a year in free cash flow and at this point, has no need for any excess cash.

Risks To Consider: The greatest concern about big buyback plans is their timing in the market cycle. In hindsight, it’s always painful to have seen companies conduct major buybacks — as Nokia Corp. (NYSE: NOK) did back in 2007 — just before a bear market begins.   

Action To Take –> The relative merits continues to be the source of much debate, though as I noted two months ago “companies with the largest buyback programs by dollar value have outperformed the broader market by 20%” since 2008. Companies such as GE, Pfizer and Cisco Systems are capable of especially large buyback plans and by that logic, should see a material boost in their share price if this tax legislation passes and the tsunami of cash starts to return to our shores.

A repatriation of money should lead to major buybacks and dividend increases — the two tenants of Total Yield investing. Not only has the strategy returned an average of 15% per year since 1982, but it’s outperformed the S&P during the dot-com bubble and the 2008 financial collapse too. To learn more about his Total Yield investing strategy, click here.