foreign branch income
(i)The term “foreign branch income” means the business profits of such United States person which are attributable to 1 or more qualified business units (as defined in section 989(a)) in 1 or more foreign countries. For purposes of the preceding sentence, the amount of business profits attributable to a qualified business unit shall be determined under rules established by the Secretary. (ii)Such term shall not include any income which is passive category income. (K)For purposes of paragraph (1)— (i)taxes carried from any taxable year beginning before, to any taxable year beginning on or after such date, with respect to any item of income, shall be treated as described in the subparagraph of paragraph (1) in which such income would be described were such taxes paid or accrued in a taxable year beginning on or after such date, and (ii)the Secretary may by regulations provide for the allocation of any carryback of taxes with respect to income from a taxable year beginning on or after, to a taxable year beginning before such date for purposes of allocating such income among the separate categories in effect for the taxable year to which carried.