Internal Revenue Code · 26 U.S.C.
§ 951. Amounts included in gross income of United States shareholders
Official text, no changes From the Office of the Law Revision Counsel, release point 119-121 (current through Public Law 119-121 (October 9, 2026)). Compare it with the official text at uscode.house.gov (external site).
Cite as 26 U.S.C. § 951
At a glance
Read from the text, the source credit and the official notes. Not part of the law.
- Status
- In force
- Added
- October 16, 1962 by Pub. L. 87–834
- Last amended
- July 4, 2025 by Pub. L. 119–21
- Amendments
- 12 dated changes in the source credit
- Length
- 3 subsections · 729 words · about 3 min to read
- Defines
- 1 term
- Cross-references
- cites 5; cited by 40 Code sections and 164 other regulations
- Regulations
- 2 issued under this section
Any amount required to be included in gross income by a United States shareholder under paragraph (1) with respect to a CFC year shall be included in gross income for the shareholder’s taxable year which includes the last day on which the shareholder owns (within the meaning of section 958(a)) stock in the controlled foreign corporation during such CFC year.
The Secretary shall prescribe such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this subsection, including regulations or other guidance allowing taxpayers to elect, or requiring taxpayers, to close the taxable year of a controlled foreign corporation upon a direct or indirect disposition of stock of such corporation.
For purposes of this title, the term “United States shareholder” means, with respect to any foreign corporation, a United States person (as defined in section 957(c)) who owns (within the meaning of section 958(a)), or is considered as owning by applying the rules of ownership of section 958(b), 10 percent or more of the total combined voting power of all classes of stock entitled to vote of such foreign corporation, or 10 percent or more of the total value of shares of all classes of stock of such foreign corporation.
If, but for this subsection, an amount would be included in the gross income of a United States shareholder for any taxable year both under subsection (a)(1)(A)(i) and under section 1293 (relating to current taxation of income from certain passive foreign investment companies), such amount shall be included in the gross income of such shareholder only under subsection (a)(1)(A).
(Added Pub. L. 87–834, § 12(a), Oct. 16, 1962, 76 Stat. 1006; amended Pub. L. 94–12, title VI, § 602(a)(3)(B), (c)(3), (4), (d)(2), Mar. 29, 1975, 89 Stat. 58, 62; Pub. L. 94–455, title XIX, § 1901(a)(119), Oct. 4, 1976, 90 Stat. 1784; Pub. L. 98–369, div. A, title I, § 132(c)(1), title VIII, § 801(d)(4), July 18, 1984, 98 Stat. 666, 996; Pub. L. 99–514, title XII, § 1235(c), title XVIII, § 1876(c)(2), Oct. 22, 1986, 100 Stat. 2574, 2898; Pub. L. 100–647, title I, § 1012(i)(15), Nov. 10, 1988, 102 Stat. 3510; Pub. L. 103–66, title XIII, §§ 13231(a), 13232(c), Aug. 10, 1993, 107 Stat. 495, 502; Pub. L. 104–188, title I, § 1501(a)(1), Aug. 20, 1996, 110 Stat. 1825; Pub. L. 105–34, title XI, § 1112(a)(1), Aug. 5, 1997, 111 Stat. 969; Pub. L. 108–357, title IV, § 413(c)(16), Oct. 22, 2004, 118 Stat. 1508; Pub. L. 110–172, § 11(g)(13), Dec. 29, 2007, 121 Stat. 2490; Pub. L. 115–97, title I, §§ 14101(e)(1), 14212(b)(1)(A), (2), 14214(a), 14215(a), Dec. 22, 2017, 131 Stat. 2192, 2217, 2218; Pub. L. 119–21, title VII, § 70354(a), July 4, 2025, 139 Stat. 210.)
Terms defined here
Where the text says “the term … means”. Select a term to jump to its definition.
Regulations under this section
Treasury regulations (26 CFR) issued under § 951
Cross-references
Computed from the citations in the text of Title 26 and 26 CFR.
This section cites 5 other sections
- § 958(a) Rules for determining stock ownership
- § 956 Investment of earnings in United States property
- § 959(a)(2) Exclusion from gross income of previously taxed earnings and profits
- § 957(c) Controlled foreign corporations; United States persons
- § 1293 Current taxation of income from qualified electing funds
Cited by 40 Code sections
- § 56A(c)(2)(C) Adjusted financial statement income
- § 163(j)(8)(A)(vi) Interest
- § 168(h)(2)(B)(ii) Accelerated cost recovery system
- § 245A(e)(2)(A) Deduction for foreign source-portion of dividends received by domestic corporations from specified 10-percent owned foreign corporations
- § 250(b)(3)(A)(i)(I) Foreign-derived deduction eligible income and net CFC tested income
- § 267A(b)(1)(B) Certain related party amounts paid or accrued in hybrid transactions or with hybrid entities
- § 304(b)(5)(A)(i)(I) Redemption through use of related corporations
- § 512(b)(17)(A) Unrelated business taxable income
- § 535(b)(10) Accumulated taxable income
- § 543(a)(1)(C) Personal holding company income
- § 851(b)(3)(B)(iii) Definition of regulated investment company
- § 864(d)(4)(B) Definitions and special rules
- § 877(d)(4)(B)(ii) Expatriation to avoid tax
- § 898(b)(3) Taxable year of certain foreign corporations
- § 904(b)(4)(B)(i) Limitation on credit
- § 951A(c)(1) Net CFC tested income included in gross income of United States shareholders
- § 951B(a)(1) Amounts included in gross income of foreign controlled United States shareholders
- § 952(a)(3)(A)(i) Subpart F income defined
- § 953(c)(1)(C) Insurance income
- § 956(c)(2)(F) Investment of earnings in United States property
- § 958(b) Rules for determining stock ownership
- § 959(a) Exclusion from gross income of previously taxed earnings and profits
- § 960(a) Deemed paid credit for subpart F inclusions
- § 961(a) Adjustments to basis of stock in controlled foreign corporations and of other property
Show 16 more
- § 962(a)(1) Election by individuals to be subject to tax at corporate rates
- § 964(e)(4)(A)(i) Miscellaneous provisions
- § 965(b)(1) Treatment of deferred foreign income upon transition to participation exemption system of taxation
- § 989(b)(3) Other definitions and special rules
- § 993(a)(1)(E) Definitions and special rules
- § 996(f)(1) Rules for allocation in the case of distributions and losses
- § 999(a)(1)(B) Reports by taxpayers; determinations
- § 1248(b)(1)(A) Gain from certain sales or exchanges of stock in certain foreign corporations
- § 1293(c) Current taxation of income from qualified electing funds
- § 1294(a)(2) Election to extend time for payment of tax on undistributed earnings
- § 1297(d)(2)(B) Passive foreign investment company
- § 1298(b)(5)(B) Special rules
- § 6241(12)(A) Definitions and special rules
- § 6501(e)(1)(C) Limitations on assessment and collection
- § 6654(d)(2)(D)(i) Failure by individual to pay estimated income tax
- § 6655(e)(4)(A) Failure by corporation to pay estimated income tax
Cited in 164 regulations not issued under it
- § 1.78-1 Gross up for deemed paid foreign tax credit.
- § 1.163-5 Denial of interest deduction on certain obligations issued after December 31, 1982, unless issued in registered form.
- § 1.163-12 Deduction of original issue discount on instrument held by related foreign person.
- § 1.163(j)-1 Definitions.
- § 1.163(j)-4 General rules applicable to C corporations (including REITs, RICs, and members of consolidated groups) and tax-exempt corporations.
- § 1.163(j)-7 Application of the section 163(j) limitation to foreign corporations and United States shareholders.
- § 1.245A-5 Limitation of section 245A deduction and section 954(c)(6) exception.
- § 1.245A-8 Coordination rules for complex cases.
- § 1.245A(d)-1 Disallowance of foreign tax credit or deduction.
- § 1.245A(e)-1 Special rules for hybrid dividends.
- § 1.250(b)-1 Computation of foreign-derived intangible income (FDII).
- § 1.250(b)-2 Qualified business asset investment (QBAI).
- § 1.267A-3 Income inclusions and amounts not treated as disqualified hybrid amounts.
- § 1.267A-4 Disqualified imported mismatch amounts.
- § 1.267A-5 Definitions and special rules.
- § 1.267(a)-3 Deduction of amounts owed to related foreign persons.
- § 1.302-2 Redemptions not taxable as dividends.
- § 1.302-4 Termination of shareholder's interest.
- § 1.331-1 Corporate liquidations.
- § 1.332-6 Records to be kept and information to be filed with return.
- § 1.334-1 Basis of property received in liquidations.
- § 1.338-2 Nomenclature and definitions; mechanics of the section 338 election.
- § 1.338-8 Asset and stock consistency.
- § 1.338-9 International aspects of section 338.
Show 120 more
- § 1.351-3 Records to be kept and information to be filed.
- § 1.355-5 Records to be kept and information to be filed.
- § 1.362-3 Basis of importation property acquired in loss importation transaction.
- § 1.367(a)-3 Treatment of transfers of stock or securities to foreign corporations.
- § 1.367(b)-2 Definitions and special rules.
- § 1.367(b)-3 Repatriation of foreign corporate assets in certain nonrecognition transactions.
- § 1.367(b)-7 Carryover of earnings and profits and foreign income taxes in certain foreign-to-foreign nonrecognition transactions.
- § 1.367(b)-10 Acquisition of parent stock or securities for property in triangular reorganizations.
- § 1.368-3 Records to be kept and information to be filed with returns.
- § 1.381(b)-1 Operating rules applicable to carryovers in certain corporate acquisitions.
- § 1.382-8 Controlled groups.
- § 1.385-3 Certain distributions of debt instruments and similar transactions.
- § 1.441-2 Election of taxable year consisting of 52-53 weeks.
- § 1.451-3 Timing of income inclusion for taxpayers with an applicable financial statement using an accrual method of accounting.
- § 1.512(b)-1 Modifications.
- § 1.542-2 Gross income requirement.
- § 1.701-2 Anti-abuse rule.
- § 1.704-1 Partner's distributive share.
- § 1.704-3 Contributed property.
- § 1.706-1 Taxable years of partner and partnership.
- § 1.851-2 Limitations.
- § 1.861-3 Dividends and income inclusions under sections 951, 951A, and 1293 and associated section 78 dividends.
- § 1.861-8 Computation of taxable income from sources within the United States and from other sources and activities.
- § 1.861-9 Allocation and apportionment of interest expense and rules for asset-based apportionment.
- § 1.861-9T Allocation and apportionment of interest expense (temporary).
- § 1.861-11T Special rules for allocating and apportioning interest expense of an affiliated group of corporations (temporary).
- § 1.861-13 Special rules for characterization of controlled foreign corporation stock.
- § 1.861-14T Special rules for allocating and apportioning certain expenses (other than interest expense) of an affiliated group of corporations (temporary).
- § 1.861-17 Allocation and apportionment of research and experimental expenditures.
- § 1.861-20 Allocation and apportionment of foreign income taxes.
- § 1.864-5 Foreign source income effectively connected with U.S. business.
- § 1.864-8T Treatment of related person factoring income (temporary).
- § 1.865-2 Loss with respect to stock.
- § 1.881-1 Manner of taxing foreign corporations.
- § 1.901-2 Income, war profits, or excess profits tax paid or accrued.
- § 1.902-1 Credit for domestic corporate shareholder of a foreign corporation for foreign income taxes paid by the foreign corporation.
- § 1.904-4 Separate application of section 904 with respect to certain categories of income.
- § 1.904-5 Look-through rules as applied to controlled foreign corporations and other entities.
- § 1.904-6 Allocation and apportionment of foreign income taxes.
- § 1.904-7 Transition rules.
- § 1.905-3 Adjustments to U.S. tax liability and to current earnings and profits as a result of a foreign tax redetermination.
- § 1.905-4 Notification of foreign tax redetermination.
- § 1.905-5 Foreign tax redeterminations of foreign corporations that relate to taxable years of the foreign corporation beginning before January 1, 2018.
- § 1.907-0 Outline of regulation provisions for section 907.
- § 1.907(a)-0 Introduction (for taxable years beginning after December 31, 1982).
- § 1.907(c)-1 Definitions relating to FOGEI and FORI (for taxable years beginning after December 31, 1982).
- § 1.907(c)-2 Section 907(c)(3) items (for taxable years beginning after December 31, 1982).
- § 1.907(c)-3 FOGEI and FORI taxes (for taxable years beginning after December 31, 1982).
- § 1.909-6 Pre-2011 foreign tax credit splitting events.
- § 1.921-1T Temporary regulations providing transition rules for DISCs and FSCs.
- § 1.951A-1 General provisions.
- § 1.951A-2 Tested income and tested loss.
- § 1.951A-3 Qualified business asset investment.
- § 1.951A-5 Treatment of GILTI inclusion amounts.
- § 1.952-1 Subpart F income defined.
- § 1.954-1 Foreign base company income.
- § 1.954-3 Foreign base company sales income.
- § 1.954-6 Foreign base company shipping income.
- § 1.955-0 Effective dates.
- § 1.955-1 Shareholder's pro rata share of amount of previously excluded subpart F income withdrawn from investment in less developed countries.
- § 1.955-2 Amount of a controlled foreign corporation's qualified investments in less developed countries.
- § 1.955-3 Election as to date of determining qualified investments in less developed countries.
- § 1.955-4 Definition of less developed country.
- § 1.955-5 Definition of less developed country corporation.
- § 1.955A-1 Shareholder's pro rata share of amount of previously excluded subpart F income withdrawn from investment in foreign base company shipping operations.
- § 1.955A-2 Amount of a controlled foreign corporation's qualified investments in foreign base company shipping operations.
- § 1.955A-3 Election as to qualified investments by related persons.
- § 1.955A-4 Election as to date of determining qualified investment in foreign base company shipping operations.
- § 1.956-1 Shareholder's pro rata share of the average of the amounts of United States property held by a controlled foreign corporation.
- § 1.956-2 Definition of United States property.
- § 1.957-1 Definition of controlled foreign corporation.
- § 1.957-3 United States person defined.
- § 1.958-1 Direct and indirect ownership of stock.
- § 1.958-2 Constructive ownership of stock.
- § 1.959-1 Exclusion from gross income of United States persons of previously taxed earnings and profits.
- § 1.959-2 Exclusion from gross income of controlled foreign corporations of previously taxed earnings and profits.
- § 1.959-3 Allocation of distributions to earnings and profits of foreign corporations.
- § 1.960-1 Overview, definitions, and computational rules for determining foreign income taxes deemed paid under section 960(a), (b), and (d).
- § 1.960-2 Foreign income taxes deemed paid under sections 960(a) and (d).
- § 1.960-3 Foreign income taxes deemed paid under section 960(b).
- § 1.960-4 Additional foreign tax credit in year of receipt of previously taxed earnings and profits.
- § 1.960-5 Credit for taxable year of inclusion binding for taxable year of exclusion.
- § 1.960-6 Overpayments resulting from increase in limitation for taxable year of exclusion.
- § 1.961-1 Increase in basis of stock in controlled foreign corporations and of other property.
- § 1.961-2 Reduction in basis of stock in foreign corporations and of other property.
- § 1.962-1 Limitation of tax for individuals on amounts included in gross income under section 951(a).
- § 1.962-2 Election of limitation of tax for individuals.
- § 1.962-3 Treatment of actual distributions.
- § 1.963-0 Repeal of section 963; effective dates.
- § 1.963-2 Determination of the amount of the minimum distribution.
- § 1.963-3 Distributions counting toward a minimum distribution.
- § 1.963-6 Deficiency distribution.
- § 1.964-1 Determination of the earnings and profits of a foreign corporation.
- § 1.964-2 Treatment of blocked earnings and profits.
- § 1.964-3 Records to be provided by United States shareholders.
- § 1.964-5 Effective date of subpart F.
- § 1.965-0 Outline of section 965 regulations.
- § 1.965-1 Overview, general rules, and definitions.
- § 1.965-2 Adjustments to earnings and profits and basis.
- § 1.965-4 Disregard of certain transactions.
- § 1.965-6 Computation of foreign income taxes deemed paid and allocation and apportionment of deductions.
- § 1.965-7 Elections, payment, and other special rules.
- § 1.965-8 Affiliated groups (including consolidated groups).
- § 1.970-1 Export trade corporations.
- § 1.970-2 Elections as to date of determining investments in export trade assets.
- § 1.972-1 Consolidation of group of export trade corporations.
- § 1.985-2 Election to use the United States dollar as the functional currency of a QBU.
- § 1.985-5 Adjustments required upon change in functional currency.
- § 1.985-7 Adjustments required in connection with a change to DASTM.
- § 1.985-8 Special rules applicable to the European Monetary Union (conversion to euro).
- § 1.987-1 Scope, definitions, and special rules.
- § 1.987-8 Termination of a section 987 QBU.
- § 1.993-1 Definition of qualified export receipts.
- § 1.996-3 Divisions of earnings and profits.
- § 1.1081-11 Records to be kept and information to be filed with returns.
- § 1.1248-1 Treatment of gain from certain sales or exchanges of stock in certain foreign corporations.
- § 1.1248-2 Earnings and profits attributable to a block of stock in simple cases.
- § 1.1248-3 Earnings and profits attributable to stock in complex cases.
- § 1.1248-4 Limitation on tax applicable to individuals.
- § 1.1248-5 Stock ownership requirements for less developed country corporations.
And 20 more; search the reader to find them.
Amendment history
From the source credit and the official notes, newest first.
- Amended by Pub. L. 119–21Parts changed in 2025: (a)
- Amended by Pub. L. 115–97Parts changed in 2017: (a)(1) (a)(1)(A) (a)(3) (b)
- Amended by Pub. L. 110–172Parts changed in 2007: (c)
- Amended by Pub. L. 108–357Parts changed in 2004: (c)
- Amended by Pub. L. 105–34Parts changed in 1997: (a)(2)
- Amended by Pub. L. 104–188Parts changed in 1996: (a)(1)(A)
- Amended by Pub. L. 103–66Parts changed in 1993: (a)(1)(B) (a)(1)(C) (a)(4)
- Amended by Pub. L. 100–647Parts changed in 1988: (b)
- Amended by Pub. L. 99–514Parts changed in 1986: (e)(1) (f)
- Amended by Pub. L. 98–369Parts changed in 1984: (d) (e)
- Amended by Pub. L. 94–455Parts changed in 1976: (a)(1)
- Amended by Pub. L. 94–12Parts changed in 1975: (a)(1)(A)(i) (a)(1)(A)(ii) (a)(1)(A)(iii) (a)(3)
- Added by Pub. L. 87–834
Where it sits in the Code
- Subtitle A Income Taxes
- Chapter 1 NORMAL TAXES AND SURTAXES
- Subchapter N Tax Based on Income From Sources Within or Without the United States
- Part III INCOME FROM SOURCES WITHOUT THE UNITED STATES
- Subpart F Controlled Foreign Corporations
Nearby sections
- § 951 Amounts included in gross income of United States shareholders
- § 951A Net CFC tested income included in gross income of United States shareholders
- § 951B Amounts included in gross income of foreign controlled United States shareholders
- § 952 Subpart F income defined
- § 953 Insurance income
Official notes
Show the Law Revision Counsel's notes (amendments, effective dates)
Editorial Notes
Amendments
2025—Subsec. (a). Pub. L. 119–21 amended subsec. (a) generally. Prior to amendment, subsec. (a) consisted of pars. (1) and (2) relating to amounts included in gross income of United States shareholders in general and pro rata share of subpart F income, respectively.
2017—Subsec. (a)(1). Pub. L. 115–97, § 14215(a), substituted “at any time” for “for an uninterrupted period of 30 days or more” in introductory provisions.
Subsec. (a)(1)(A). Pub. L. 115–97, § 14212(b)(1)(A), amended subpar. (A) generally. Prior to amendment, subpar. (A) read as follows: “the sum of—
“(i) his pro rata share (determined under paragraph (2)) of the corporation’s subpart F income for such year,
“(ii) his pro rata share (determined under section 955(a)(3) as in effect before the enactment of the Tax Reduction Act of 1975) of the corporation’s previously excluded subpart F income withdrawn from investment in less developed countries for such year, and
“(iii) his pro rata share (determined under section 955(a)(3)) of the corporation’s previously excluded subpart F income withdrawn from foreign base company shipping operations for such year; and”.
Subsec. (a)(3). Pub. L. 115–97, § 14212(b)(2), struck out par. (3). Text read as follows: “For purposes of paragraph (1)(A)(iii), the pro rata share of any United States shareholder of the previously excluded subpart F income of a controlled foreign corporation withdrawn from investment in foreign base company shipping operations shall not exceed an amount—
“(A) which bears the same ratio to his pro rata share of such income withdrawn (as determined under section 955(a)(3)) for the taxable year, as
“(B) the part of such year during which the corporation is a controlled foreign corporation bears to the entire year.”
Subsec. (b). Pub. L. 115–97, § 14214(a), inserted “, or 10 percent or more of the total value of shares of all classes of stock of such foreign corporation” after “such foreign corporation”.
Pub. L. 115–97, § 14101(e)(1), substituted “title” for “subpart”.
2007—Subsecs. (c), (d). Pub. L. 110–172 redesignated subsec. (d) as (c) and struck out heading and text of former subsec. (c). Text read as follows:
“(1) In general.—The foreign trade income of a FSC and any deductions which are apportioned or allocated to such income shall not be taken into account under this subpart.
“(2) Foreign trade income.—For purposes of this subsection, the term ‘foreign trade income’ has the meaning given such term by section 923(b), but does not include section 923(a)(2) non-exempt income (within the meaning of section 927(d)(6)).”
2004—Subsecs. (c) to (f). Pub. L. 108–357 redesignated subsecs. (e) and (f) as (c) and (d), respectively, and struck out former subsecs. (c) and (d), which related to coordination of provisions with election of a foreign investment company to distribute income and coordination with foreign personal holding company provisions, respectively.
1997—Subsec. (a)(2). Pub. L. 105–34 inserted concluding provisions “For purposes of subparagraph (B), any gain included in the gross income of any person as a dividend under section 1248 shall be treated as a distribution received by such person with respect to the stock involved.”
1996—Subsec. (a)(1)(A) to (C). Pub. L. 104–188 inserted “and” at end of subpar. (A), substituted period for “; and” at end of subpar. (B), and struck out subpar. (C) which read as follows: “the amount determined under section 956A with respect to such shareholder for such year (but only to the extent not excluded from gross income under section 959(a)(3)).”
1993—Subsec. (a)(1)(B). Pub. L. 103–66, § 13232(c)(1), substituted “the amount determined under section 956 with respect to such shareholder for such year (but only to the extent not excluded from gross income under section 959(a)(2)); and” for “his pro rata share (determined under section 956(a)(2)) of the corporation’s increase in earnings invested in United States property for such year (but only to the extent not excluded from gross income under section 959(a)(2)); and”.
Subsec. (a)(1)(C). Pub. L. 103–66, § 13231(a), added subpar. (C).
Subsec. (a)(4). Pub. L. 103–66, § 13232(c)(2), struck out heading and text of par. (4). Text read as follows: “For purposes of paragraph (1)(B), the pro rata share of any United States shareholder in the increase of the earnings of a controlled foreign corporation invested in United States property shall not exceed an amount (A) which bears the same ratio to his pro rata share of such increase (as determined under section 956(a)(2)) for the taxable year, as (B) the part of such year during which the corporation is a controlled foreign corporation bears to the entire year.”
1988—Subsec. (b). Pub. L. 100–647 substituted “section 957(c)” for “section 957(d)”.
1986—Subsec. (e)(1). Pub. L. 99–514, § 1876(c)(2), struck out last sentence which read as follows: “For purposes of the preceding sentence, income described in paragraph (2) or (3) of section 921(d) shall be treated as derived from sources within the United States.”
Subsec. (f). Pub. L. 99–514, § 1235(c), added subsec. (f).
1984—Subsec. (d). Pub. L. 98–369, § 132(c)(1), amended subsec. (d) generally, substituting provision that, if a United States shareholder is required to include in gross income an amount under both subsec. (a)(1)(A)(ii) of this section and section 551(b) of this title, such amount be included only under subsec. (a)(1)(A)(ii) of this section for provision that, if a United States shareholder is subject to tax under section 551(b) of this title, such shareholder not be required to include as gross income any amount under subsec. (a) of this section.
Subsec. (e). Pub. L. 98–369, § 801(d)(4), added subsec. (e).
1976—Subsec. (a)(1). Pub. L. 94–455 struck out “beginning after December 31, 1962” after “during any taxable year”.
1975—Subsec. (a)(1)(A)(i). Pub. L. 94–12, § 602(a)(3)(B), struck out “except as provided in section 963,” before “his pro rata share”.
Subsec. (a)(1)(A)(ii). Pub. L. 94–12, § 602(c)(3), substituted “(determined under section 955(a)(3) as in effect before the enactment of the Tax Reduction Act of 1975)” for “(determined under section 955(a)(3))”.
Subsec. (a)(1)(A)(iii). Pub. L. 94–12, § 602(d)(2)(A), added cl. (iii).
Subsec. (a)(3). Pub. L. 94–12, § 602(c)(4), (d)(2)(B), substituted “paragraph (i)(A)(iii)” for “paragraph (1)(A)(ii)” and “foreign base company shipping operations” for “less developed countries”.
Statutory Notes and Related Subsidiaries
Effective Date of 2025 Amendment
Pub. L. 119–21, title VII, § 70354(c), July 4, 2025, 139 Stat. 212, provided that:
“(1) In general.— The amendments made by this section [amending this section and section 951A of this title] shall apply to taxable years of foreign corporations beginning after December 31, 2025.“(2) Transition rule for dividends.— Except to the extent provided by the Secretary of the Treasury (or the Secretary’s delegate), a dividend paid (or deemed paid) by a controlled foreign corporation shall not be treated as a dividend for purposes of applying section 951(a)(2)(B) of the Internal Revenue Code of 1986 (as in effect before the amendments made by this section) if—“(A) such dividend—“(i) was paid (or deemed paid) on or before June 28, 2025, during the taxable year of such controlled foreign corporation which includes such date and the United States shareholder described in section 951(a)(1) of such Code (as so in effect) did not own (within the meaning of section 958(a) of such Code) the stock of such controlled foreign corporation during the portion of such taxable year on or before June 28, 2025, or“(ii) was paid (or deemed paid) after June 28, 2025, and before such controlled foreign corporation’s first taxable year beginning after December 31, 2025, and“(B) such dividend does not increase the taxable income of a United States person that is subject to Federal income tax for the taxable year (including by reason of a dividends received deduction, an exclusion from gross income, or an exclusion from subpart F income).”
Effective Date of 2017 Amendment
Amendment by section 14101(e)(1) of Pub. L. 115–97 applicable to distributions made after Dec. 31, 2017, see section 14101(f) of Pub. L. 115–97, set out as an Effective Date note under section 245A of this title.
Amendment by section 14212(b)(1)(A), (2) of Pub. L. 115–97 applicable to taxable years of foreign corporations beginning after Dec. 31, 2017, and to taxable years of United States shareholders in which or with which such taxable years of foreign corporations end, see section 14212(c) of Pub. L. 115–97, set out as a note under section 851 of this title.
Pub. L. 115–97, title I, § 14214(b), Dec. 22, 2017, 131 Stat. 2218, provided that: “The amendment made by this section [amending this section] shall apply to taxable years of foreign corporations beginning after December 31, 2017, and to taxable years of United States shareholders with or within which such taxable years of foreign corporations end.”
Pub. L. 115–97, title I, § 14215(b), Dec. 22, 2017, 131 Stat. 2218, provided that: “The amendment made by this section [amending this section] shall apply to taxable years of foreign corporations beginning after December 31, 2017, and to taxable years of United States shareholders with or within which such taxable years of foreign corporations end.”
Effective Date of 2004 Amendment
Amendment by Pub. L. 108–357 applicable to taxable years of foreign corporations beginning after Dec. 31, 2004, and to taxable years of United States shareholders with or within which such taxable years of foreign corporations end, see section 413(d)(1) of Pub. L. 108–357, set out as an Effective and Termination Dates of 2004 Amendments note under section 1 of this title.
Effective Date of 1997 Amendment
Pub. L. 105–34, title XI, § 1112(a)(2), Aug. 5, 1997, 111 Stat. 969, provided that: “The amendment made by paragraph (1) [amending this section] shall apply to dispositions after the date of the enactment of this Act [Aug. 5, 1997].”
Effective Date of 1996 Amendment
Amendment by Pub. L. 104–188 applicable to taxable years of foreign corporations beginning after Dec. 31, 1996, and to taxable years of United States shareholders within which or with which such taxable years of foreign corporations end, see section 1501(d) of Pub. L. 104–188, set out as a note under section 904 of this title.
Effective Date of 1993 Amendment
Pub. L. 103–66, title XIII, § 13231(e), Aug. 10, 1993, 107 Stat. 501, provided that: “The amendments made by this section [enacting section 956A of this title and amending this section and sections 959, 989, 1293, 1296, and 1297 of this title] shall apply to taxable years of foreign corporations beginning after September 30, 1993, and to taxable years of United States shareholders in which or with which such taxable years of foreign corporations end.”
Pub. L. 103–66, title XIII, § 13232(d), Aug. 10, 1993, 107 Stat. 502, provided that: “The amendments made by this section [amending this section and section 956 of this title] shall apply to taxable years of controlled foreign corporations beginning after September 30, 1993, and to taxable years of United States shareholders in which or with which such taxable years of controlled foreign corporations end.”
Effective Date of 1988 Amendment
Amendment by Pub. L. 100–647 effective, 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) of Pub. L. 100–647, set out as a note under section 1 of this title.
Effective Date of 1986 Amendment
Amendment by section 1235(c) of Pub. L. 99–514 applicable to taxable years of foreign corporations beginning after Dec. 31, 1986, see section 1235(h) of Pub. L. 99–514, set out as an Effective Date note under section 1291 of this title.
Amendment by section 1876(c)(2) of Pub. L. 99–514 effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98–369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99–514, set out as a note under section 48 of this title.
Effective Date of 1984 Amendment
Pub. L. 98–369, div. A, title I, § 132(d)(2)(A), July 18, 1984, 98 Stat. 667, provided that: “The amendment made by paragraph (1) of subsection (c) [amending this section] shall apply to taxable years of United States shareholders beginning after the date of the enactment of this Act [July 18, 1984].”
Amendment by section 801(d)(4) of Pub. L. 98–369 applicable to transactions after Dec. 31, 1984, in taxable years ending after such date, see section 805(a)(1) of Pub. L. 98–369, as amended, set out as a note under section 245 of this title.
Effective Date of 1975 Amendment
Amendment by Pub. L. 94–12 applicable to taxable years of foreign corporations beginning after Dec. 31, 1975, and to taxable years of United States shareholders (within the meaning of 951(b) of this title) within which or with which such taxable years of such foreign corporations end, see section 602(f) of Pub. L. 94–12, set out as a note under section 954 of this title.
Effective Date
Pub. L. 87–834, § 12(c), Oct. 16, 1962, 76 Stat. 1031, provided that: “The amendments made by this section [enacting this section and sections 952 to 964 and 970 to 972 of this title and amending sections 901, 904, and 1016 of this title] shall apply with respect to taxable years of foreign corporations beginning after December 31, 1962, and to taxable year of United States shareholders within which or with which such taxable years of such foreign corporations end.”
Plan Amendments Not Required Until January 1, 1989
For provisions directing that if any amendments made by subtitle A or subtitle C of title XI [§§ 1101–1147 and 1171–1177] or title XVIII [§§ 1800–1899A] of Pub. L. 99–514 require an amendment to any plan, such plan amendment shall not be required to be made before the first plan year beginning on or after Jan. 1, 1989, see section 1140 of Pub. L. 99–514, as amended, set out as a note under section 401 of this title.