Basic rule

Basic rule -
(1) In general. The term United States person has the same meaning for purposes of sections 951 through 965 that it has under section 7701(a)(30) and the regulations under that section, except as provided in paragraphs (b) and (c) of this section, which provide, with respect to corporations organized in possessions of the United States, that certain residents of such possessions are not United States persons. The effect of determining that an individual is not a United States person for such purposes is to exclude such individual in determining whether a foreign corporation created or organized in, or under the laws of, a possession of the United States is a controlled foreign corporation. See § 1.957-1 for the definition of the term “controlled foreign corporation.”
(2) Special provisions applicable to possessions of the United States. For purposes of this section -
(i) The term possession of the United States means Puerto Rico or any section 931 possession;
(ii) The term section 931 possession has the same meaning that it has under § 1.931-1(c)(1);
(iii) The rules of § 1.937-1 will apply for determining whether an individual is a bona fide resident of a possession of the United States;
(iv) Except as provided in paragraph (b)(2) of this section, the rules of § 1.937-2 will apply for determining whether income is from sources within a possession of the United States; and
(v) The rules of § 1.937-3 will apply for determining whether income is effectively connected with the conduct of a trade or business in a possession of the United States.

Source

26 CFR § 1.957-3


Scoping language

None
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