Internal Revenue Code · 26 U.S.C.
§ 958. Rules for determining stock ownership
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. § 958
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
- 5 dated changes in the source credit
- Length
- 2 subsections · 531 words · about 2 min to read
- Defines
- 1 term
- Cross-references
- cites 7; cited by 27 Code sections and 88 other regulations
- Regulations
- 2 issued under this section
For purposes of subparagraph (B) of paragraph (1), stock owned, directly or indirectly, by or for a foreign corporation, foreign partnership, or foreign trust or foreign estate (within the meaning of section 7701(a)(31)) shall be considered as being owned proportionately by its shareholders, partners, or beneficiaries. Stock considered to be owned by a person by reason of the application of the preceding sentence shall, for purposes of applying such sentence, be treated as actually owned by such person.
For purposes of applying paragraph (1) in the case of a foreign mutual insurance company, the term “stock” shall include any certificate entitling the holder to voting power in the corporation.
(Added Pub. L. 87–834, § 12(a), Oct. 16, 1962, 76 Stat. 1018; amended Pub. L. 88–554, § 4(b)(5), Aug. 31, 1964, 78 Stat. 763; Pub. L. 94–455, title X, § 1021(b), Oct. 4, 1976, 90 Stat. 1619; Pub. L. 104–188, title I, §§ 1703(i)(4), 1704(t)(7), Aug. 20, 1996, 110 Stat. 1876, 1887; Pub. L. 115–97, title I, §§ 14213(a), 14301(c)(31), Dec. 22, 2017, 131 Stat. 2217, 2224; Pub. L. 119–21, title VII, § 70353(a), July 4, 2025, 139 Stat. 209.)
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 § 958
Cross-references
Computed from the citations in the text of Title 26 and 26 CFR.
This section cites 7 other sections
- § 960 Deemed paid credit for subpart F inclusions
- § 7701(a)(31) Definitions
- § 951(b) Amounts included in gross income of United States shareholders
- § 954(d)(3) Foreign base company income
- § 956(c)(2) Investment of earnings in United States property
- § 957 Controlled foreign corporations; United States persons
- § 318(a) Constructive ownership of stock
Cited by 27 Code sections
- § 163(e)(3)(B)(i) Interest
- § 267(a)(3)(B)(i) Losses, expenses, and interest with respect to transactions between related taxpayers
- § 269B(e)(2)(B) Stapled entities
- § 304(b)(5)(A)(i) Redemption through use of related corporations
- § 318(b)(7) Constructive ownership of stock
- § 545(a) Undistributed personal holding company income
- § 864(c)(4)(D)(i) Definitions and special rules
- § 877(d)(1)(C)(i) Expatriation to avoid tax
- § 898(b)(2)(B) Taxable year of certain foreign corporations
- § 904(f)(3)(D)(vi) Limitation on credit
- § 934(b)(3)(B)(ii) Limitation on reduction in income tax liability incurred to the Virgin Islands
- § 951(a)(1)(A) Amounts included in gross income of United States shareholders
- § 951A(c)(2) Net CFC tested income included in gross income of United States shareholders
- § 951B(b)(2) Amounts included in gross income of foreign controlled United States shareholders
- § 953(c)(1)(A) Insurance income
- § 954(c)(4)(B) Foreign base company income
- § 956(b)(3)(A) Investment of earnings in United States property
- § 957(a)(2) Controlled foreign corporations; United States persons
- § 959(a)(2) Exclusion from gross income of previously taxed earnings and profits
- § 961(a) Adjustments to basis of stock in controlled foreign corporations and of other property
- § 964(b) Miscellaneous provisions
- § 1248(a)(2) Gain from certain sales or exchanges of stock in certain foreign corporations
- § 1249(b) Gain from certain sales or exchanges of patents, etc., to foreign corporations
- § 1297(d)(4) Passive foreign investment company
Show 3 more
Cited in 88 regulations not issued under it
- § 1.163(j)-1 Definitions.
- § 1.245A-5 Limitation of section 245A deduction and section 954(c)(6) exception.
- § 1.245A-6 Coordination of extraordinary disposition and disqualified basis rules.
- § 1.245A-8 Coordination rules for complex cases.
- § 1.245A(e)-1 Special rules for hybrid dividends.
- § 1.267A-2 Hybrid and branch arrangements.
- § 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.
- § 1.269B-1 Stapled foreign corporations.
- § 1.338-8 Asset and stock consistency.
- § 1.367(a)-3 Treatment of transfers of stock or securities to foreign corporations.
- § 1.367(a)-8 Gain recognition agreement requirements.
- § 1.367(b)-3 Repatriation of foreign corporate assets in certain nonrecognition transactions.
- § 1.367(b)-4 Acquisition of foreign corporate stock or assets by a foreign corporation in certain nonrecognition transactions.
- § 1.385-3 Certain distributions of debt instruments and similar transactions.
- § 1.679-2 Trusts treated as having a U.S. beneficiary.
- § 1.706-1 Taxable years of partner and partnership.
- § 1.861-9T Allocation and apportionment of interest expense (temporary).
- § 1.864-5 Foreign source income effectively connected with U.S. business.
- § 1.883-3 Treatment of controlled foreign corporations.
- § 1.901-2 Income, war profits, or excess profits tax paid or accrued.
- § 1.934-1 Limitation on reduction in income tax liability incurred to the Virgin Islands.
- § 1.951-1 Amounts included in gross income of United States shareholders.
Show 64 more
- § 1.951A-1 General provisions.
- § 1.951A-2 Tested income and tested loss.
- § 1.951A-3 Qualified business asset investment.
- § 1.952-1 Subpart F income defined.
- § 1.954-1 Foreign base company income.
- § 1.954-2 Foreign personal holding company income.
- § 1.954-6 Foreign base company shipping income.
- § 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.
- § 1.955-5 Definition of less developed country corporation.
- § 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.
- § 1.957-2 Controlled foreign corporation deriving income from insurance of United States risks.
- § 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).
- § 1.961-1 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.
- § 1.962-2 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.
- § 1.964-1 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.
- § 1.964-4 Verification of certain classes of income.
- § 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.
- § 1.965-3 Section 965(c) deductions.
- § 1.965-4 Disregard of certain transactions.
- § 1.965-5 Allowance of credit or deduction for foreign income taxes.
- § 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.
- § 1.987-1 Scope, definitions, and special rules.
- § 1.987-2 Attribution of items to eligible QBUs; definition of a transfer and related rules.
- § 1.995-5 Foreign investment attributable to producer's loans.
- § 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.
- § 1.1248-6 Sale or exchange of stock in certain domestic corporations.
- § 1.1248-7 Taxpayer to establish earnings and profits and foreign taxes.
- § 1.1249-1 Gain from certain sales or exchanges of patents, etc., to foreign corporations.
- § 1.1295-3 Retroactive elections.
- § 1.1297-2 Special rules regarding look-through subsidiaries and look-through partnerships.
- § 1.1502-80 Applicability of other provisions of law.
- § 1.6038-5 Information returns required of certain United States persons to report amounts determined with respect to certain foreign corporations for global intangible low-taxed income (GILTI) purposes.
- § 1.6038B-1 Reporting of certain transfers to foreign corporations.
- § 1.6043-4 Information returns relating to certain acquisitions of control and changes in capital structure.
- § 1.6655-2 Annualized income installment method.
- § 1.7701(l)-4 Rules regarding inversion transactions.
- § 4.954-2 Foreign personal holding company income; taxable years beginning after December 31, 1986.
- § 20.2107-1 Expatriation to avoid tax.
Amendment history
From the source credit and the official notes, newest first.
- Amended by Pub. L. 119–21Parts changed in 2025: (b) (b)(4)
- Amended by Pub. L. 115–97Parts changed in 2017: (a)(1) (b) (b)(4)
- Amended by Pub. L. 104–188Parts changed in 1996: (a)(1) (b)
- Amended by Pub. L. 94–455Parts changed in 1976: (b)
- Amended by Pub. L. 88–554Parts changed in 1964: (b)
- 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
- § 955 Repealed
- § 956 Investment of earnings in United States property
- § 956A Repealed
- § 957 Controlled foreign corporations; United States persons
- § 958 Rules for determining stock ownership
- § 959 Exclusion from gross income of previously taxed earnings and profits
- § 960 Deemed paid credit for subpart F inclusions
- § 961 Adjustments to basis of stock in controlled foreign corporations and of other property
- § 962 Election by individuals to be subject to tax at corporate rates
Official notes
Show the Law Revision Counsel's notes (amendments, effective dates)
Editorial Notes
Amendments
2025—Subsec. (b). Pub. L. 119–21, § 70353(a)(2), substituted “Paragraphs (1) and (4)” for “Paragraph (1)” in concluding provisions.
Subsec. (b)(4). Pub. L. 119–21, § 70353(a)(1), added par. (4).
2017—Subsec. (a)(1). Pub. L. 115–97, § 14301(c)(31), substituted “960” for “960(a)(1)” in introductory provisions.
Subsec. (b). Pub. L. 115–97, § 14213(a)(2), substituted “Paragraph (1)” for “Paragraphs (1) and (4)” in concluding provisions.
Subsec. (b)(4). Pub. L. 115–97, § 14213(a)(1), struck out par. (4) which read as follows: “Subparagraphs (A), (B), and (C) of section 318(a)(3) shall not be applied so as to consider a United States person as owning stock which is owned by a person who is not a United States person.”
1996—Subsec. (a)(1). Pub. L. 104–188, § 1704(t)(7), substituted “section 960(a)(1)” for “sections 955(b)(1)(A) and (B), 955(c)(2)(A)(ii), and 960(a)(1)” in introductory provisions.
Subsec. (b). Pub. L. 104–188, § 1703(i)(4), substituted “956(c)(2)” for “956(b)(2)” wherever appearing in introductory and closing provisions.
1976—Subsec. (b). Pub. L. 94–455 inserted “956(b)(2)” after “purposes of sections 951(b), 954(d)(3),”, “to treat the stock of a domestic corporation as owned by a United States shareholder of the controlled foreign corporation for purposes of section 956(b)(2)” after “meaning of section 954(d)(3)” and “Paragraphs (1) and (4) shall not apply for purposes of section 956(b)(2) to treat stock of a domestic corporation as not owned by a United States shareholder” following subpar. (4).
1964—Subsec. (b). Pub. L. 88–554 redesignated pars. (4) and (5) as (3) and (4), respectively, struck out former par. (3) which related to ownership of stock by a partnership, estate, trust, or corporation for purposes of applying first sentence of subpars. (A) and (B), and subpar. (C)(i) of section 318(a)(2) of this title, and made amendments throughout subsec. (b) to conform to changes made in section 318 of this title by Pub. L. 88–554.
Statutory Notes and Related Subsidiaries
Effective Date of 2025 Amendment
Amendment by Pub. L. 119–21 applicable to taxable years of foreign corporations beginning after Dec. 31, 2025, see section 70353(d) of Pub. L. 119–21, set out as an Effective Date note under section 951B of this title.
Effective Date of 2017 Amendment
Pub. L. 115–97, title I, § 14213(b), Dec. 22, 2017, 131 Stat. 2217, provided that:
“The amendments made by this section [amending this section] shall apply to—“(1) the last taxable year of foreign corporations beginning before January 1, 2018, and each subsequent taxable year of such foreign corporations, and“(2) taxable years of United States shareholders in which or with which such taxable years of foreign corporations end.”
Amendment by section 14301(c)(31) 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 14301(d) of Pub. L. 115–97, set out as a note under section 78 of this title.
Effective Date of 1996 Amendment
Amendment by section 1703(i)(4) of Pub. L. 104–188 effective as if included in the provision of the Revenue Reconciliation Act of 1993, Pub. L. 103–66, §§ 13001–13444, to which such amendment relates, see section 1703(o) of Pub. L. 104–188, set out as a note under section 39 of this title.
Effective Date of 1976 Amendment
Amendment by Pub. L. 94–455 applicable to taxable years of foreign corporations beginning after Dec. 31, 1975, and to taxable years of United States shareholders within which or with which such taxable years of such corporations end, see section 1021(c) of Pub. L. 94–455, set out as a note under section 956 of this title.
Effective Date of 1964 Amendment
Amendment by Pub. L. 88–554 effective Aug. 31, 1964, except that for purposes of sections 302 and 304 of this title, such amendments shall not apply to distributions in payment for stock acquisitions or redemptions, if such acquisitions or redemptions occurred before Aug. 31, 1964, see section 4(c) of Pub. L. 88–554, set out as a note under section 318 of this title.
Construction
Amendment by Pub. L. 119–21 not to be construed to create any inference with respect to the proper application of any provision of this title with respect to taxable years beginning before the taxable years to which such amendment applies, see section 70353(f) of Pub. L. 119–21, set out as a note under section 951B of this title.