General rule
Election
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.
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 951(a).
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.
Pub. L. 87–834, § 12(a)76 Stat. 1023Pub. L. 94–12, title III, § 303(c)(3)89 Stat. 45Pub. L. 94–164, § 4(d)(1)89 Stat. 975Pub. L. 94–455, title XIX, § 1906(b)(13)(A)90 Stat. 1834Pub. L. 95–600, title III, § 301(b)(16)92 Stat. 2822Pub. L. 100–647, title I, § 1007(g)(11)102 Stat. 3435Pub. L. 115–97, title I, § 12001(b)(15)131 Stat. 2094(Added , , ; amended , , ; , , ; , , ; , , ; , , ; , , .)
Editorial Notes
References in Text
Pub. L. 115–97Section 960, referred to in subsec. (a)(2), was amended extensively by , and, as so amended, relates to deemed paid credit for subpart F inclusions.
Amendments
Pub. L. 115–972017—Subsec. (a)(1). substituted “section 11” for “sections 11 and 55”.
Pub. L. 100–6471988—Subsec. (a)(1). substituted “sections 1 and 55” and “sections 11 and 55” for “section 1” and “section 11”, respectively.
Pub. L. 95–6001978—Subsec. (c). substituted provisions relating to the pro ration of each section 11 bracket amount for provisions relating to the surtax exemption.
Pub. L. 94–4551976—Subsecs. (a), (b). struck out “or his delegate” after “Secretary” wherever appearing.
Pub. L. 94–1641975—Subsec. (c). substituted “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 .
Pub. L. 94–12 substituted “$50,000” for “$25,000”.
Statutory Notes and Related Subsidiaries
Effective Date of 2017 Amendment
Pub. L. 115–97section 12001(c) of Pub. L. 115–97section 11 of this titleAmendment by applicable to taxable years beginning after , see , set out as a note under .
Effective Date of 1988 Amendment
Pub. L. 100–647Pub. L. 99–514section 1019(a) of Pub. L. 100–647section 1 of this titleAmendment by effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, , to which such amendment relates, see , set out as a note under .
Effective Date of 1978 Amendment
Pub. L. 95–600section 301(c) of Pub. L. 95–600section 11 of this titleAmendment by applicable to taxable years beginning after , see , set out as a note under .
Effective and Termination Dates of 1975 Amendments
Pub. L. 94–164section 4(e) of Pub. L. 94–164section 11 of this titleAmendment by applicable to taxable years beginning after , see , set out as a note under .
Pub. L. 94–12section 305(b)(1) of Pub. L. 94–12section 11 of this titleAmendment by applicable to taxable years ending after , but to cease to apply for taxable years ending after , see , set out as a note under .