Under regulations prescribed by the Secretary, in the case of a United States shareholder who is an individual and who elects to have the provisions of this section apply for the taxable year—
(1)the tax imposed under this chapter on amounts which are included in his gross income under section
951(a) shall (in lieu of the tax determined under sections
55) be an amount equal to the tax which would be imposed under sections
55 if such amounts were received by a domestic corporation, and
(2)for purposes of applying the provisions of section
960 (relating to foreign tax credit) such amounts shall be treated as if they were received by a domestic corporation.
An election to have the provisions of this section apply for any taxable year shall be made by a United States shareholder at such time and in such manner as the Secretary shall prescribe by regulations. An election made for any taxable year may not be revoked except with the consent of the Secretary.
(c) Pro ration of each section
11 bracket amount
For purposes of applying subsection (a)(1), the amount in each taxable income bracket in the tax table in section
11(b) shall not exceed an amount which bears the same ratio to such bracket amount as the amount included in the gross income of the United States shareholder under section
951(a) for the taxable year bears to such shareholder’s pro rata share of the earnings and profits for the taxable year of all controlled foreign corporations with respect to which such shareholder includes any amount in gross income under section
(d) Special rule for actual distributions
The earnings and profits of a foreign corporation attributable to amounts which were included in the gross income of a United States shareholder under section
951(a) and with respect to which an election under this section applied shall, when such earnings and profits are distributed, notwithstanding the provisions of section
959(a)(1), be included in gross income to the extent that such earnings and profits so distributed exceed the amount of tax paid under this chapter on the amounts to which such election applied.
1988—Subsec. (a)(1). Pub. L. 100–647substituted “sections
55” and “sections
55” for “section
1” and “section
1978—Subsec. (c). Pub. L. 95–600substituted provisions relating to the pro ration of each section
11 bracket amount for provisions relating to the surtax exemption.
1976—Subsecs. (a), (b). Pub. L. 94–455struck out “or his delegate” after “Secretary” wherever appearing.
1975—Subsec. (c). Pub. L. 94–164substituted “same ratio to the surtax exemption” for “same ratio to $25,000” in subsec. (c) as such subsec. (c) is in effect for taxable years ending after Dec. 31, 1975.
Amendment by Pub. L. 100–647effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, Pub. L. 99–514, to which such amendment relates, see section 1019(a) ofPub. L. 100–647, set out as a note under section
1 of this title.
Effective Date of 1978 Amendment
Amendment by Pub. L. 95–600applicable to taxable years beginning after Dec. 31, 1978, see section 301(c) ofPub. L. 95–600, set out as a note under section
11 of this title.
Effective and Termination Dates of 1975 Amendments
Amendment by Pub. L. 94–164applicable to taxable years beginning after Dec. 31, 1975, see section 4(e) ofPub. L. 94–164, set out as a note under section
11 of this title.
Amendment by Pub. L. 94–12applicable to taxable years ending after Dec. 31, 1974, but to cease to apply for taxable years ending after Dec. 31, 1975, see section 305(b)(1) ofPub. L. 94–12, set out as a note under section
11 of this title.
The table below lists the classification updates, since Jan. 3, 2012, for this section. Updates to a broader range of sections may be found at the update page for containing chapter, title, etc.
The most recent Classification Table update that we have noticed was Tuesday, August 13, 2013
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Description of Change
Statutes at Large
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