US Code

Public Law 119-73 (01/23/2026)

26 U.S.C. § 563

Rules relating to dividends paid after close of taxable year

(a)

Accumulated earnings tax

In the determination of the dividends paid deduction for purposes of the accumulated earnings tax imposed by section 531, a dividend paid after the close of any taxable year and on or before the 15th day of the fourth month following the close of such taxable year shall be considered as paid during such taxable year.

(b)

Personal holding company tax

In the determination of the dividends paid deduction for purposes of the personal holding company tax imposed by section 541, a dividend paid after the close of any taxable year and on or before the 15th day of the fourth month following the close of such taxable year shall, to the extent the taxpayer elects in its return for the taxable year, be considered as paid during such taxable year. The amount allowed as a dividend by reason of the application of this subsection with respect to any taxable year shall not exceed either—
(1)
The undistributed personal holding company income of the corporation for the taxable year, computed without regard to this subsection, or
(2)
20 percent of the sum of the dividends paid during the taxable year, computed without regard to this subsection.
(c)

Dividends considered as paid on last day of taxable year

For the purpose of applying section 562(a), with respect to distributions under subsection (a) or (b) of this section, a distribution made after the close of a taxable year and on or before the 15th day of the fourth month following the close of the taxable year shall be considered as made on the last day of such taxable year.

Aug. 16, 1954, ch. 73668A Stat. 199Pub. L. 91–172, title IX, § 914(a)83 Stat. 723Pub. L. 101–239, title VII, § 7401(b)103 Stat. 2356Pub. L. 108–357, title IV, § 413(c)(10)118 Stat. 1507Pub. L. 114–41, title II, § 2006(a)(2)(B)129 Stat. 457(, ; , , ; , , ; , , ; , , .)

Editorial Notes

Amendments

Pub. L. 114–412015— substituted “fourth month” for “third month” wherever appearing.

Pub. L. 108–3572004—Subsecs. (c), (d). redesignated subsec. (d) as (c), substituted “subsection (a) or (b)” for “subsection (a), (b), or (c)”, and struck out former subsec. (c) which related to foreign personal holding company tax.

Pub. L. 101–239, § 7401(b)(1)1989—Subsec. (c). , added subsec. (c). Former subsec. (c) redesignated (d).

Pub. L. 101–239, § 7401(b)(2)Subsec. (d). , substituted “subsection (a), (b), or (c)” for “subsection (a) or (b)”.

Pub. L. 101–239, § 7401(b)(1), redesignated former subsec. (c) as (d).

Pub. L. 91–1721969—Subsec. (b)(2). substituted “20 percent” for “10 percent”.

Statutory Notes and Related Subsidiaries

Effective Date of 2015 Amendment

Pub. L. 114–41section 2006(a)(3) of Pub. L. 114–41section 170 of this titleAmendment by applicable to returns for taxable years beginning after , with special rule for certain C corporations, see , set out as a note under .

Effective Date of 2004 Amendment

Pub. L. 108–357section 413(d)(1) of Pub. L. 108–357section 1 of this titleAmendment by applicable to taxable years of foreign corporations beginning after , and to taxable years of United States shareholders with or within which such taxable years of foreign corporations end, see , set out as an Effective and Termination Dates of 2004 Amendments note under .

Effective Date of 1989 Amendment

Pub. L. 101–239section 7401 of Pub. L. 101–239section 7401(d) of Pub. L. 101–239section 898 of this titleAmendment by applicable to taxable years of foreign corporations beginning after , with special rules for any foreign corporation required by the amendments made by to change its taxable year for its first taxable year beginning after , see , set out as an Effective Date note under .

Effective Date of 1969 Amendment

Pub. L. 91–172, title IX, § 914(b)83 Stat. 723

“The amendment made by subsection (a) [amending this section] shall apply to taxable years beginning after .”
, , , provided that: