Title 26 — Internal Revenue Code
Part III · Chapter 1 — Normal Taxes and Surtaxes
§ 951. Amounts included in gross income of United States shareholders
Statutory text
Amounts included
In general
If a foreign corporation is a controlled foreign corporation at any time during a taxable year of the foreign corporation (in this subsection referred to as the “CFC year”)—
each United States shareholder which owns (within the meaning of section 958(a)) stock in such corporation on any day during the CFC year shall include in gross income such shareholder’s pro rata share (determined under paragraph (2)) of the corporation’s subpart F income for the CFC year, and
each United States shareholder which owns (within the meaning of section 958(a)) stock in such corporation on the last day, in the CFC year, on which such corporation is a controlled foreign corporation shall include in gross income the amount determined under section 956 with respect to such shareholder for the CFC year (but only to the extent not excluded from gross income under section 959(a)(2)).
Pro rata share of subpart F income
A United States shareholder’s pro rata share of a controlled foreign corporation’s subpart F income for a CFC year shall be the portion of such income which is attributable to—
the stock of such corporation owned (within the meaning of section 958(a)) by such shareholder, and
any period of the CFC year during which—
such shareholder owned (within the meaning of section 958(a)) such stock,
such shareholder was a United States shareholder of such corporation, and
such corporation was a controlled foreign corporation.
Taxable year of inclusion
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.
Regulatory authority
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.
United States shareholder defined
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.
Coordination with passive foreign investment company provisions
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).
Legislative history
Reconstructed from this section’s Code source credit and amendment notes, resolved against the local Statutes at Large. Editorial notes are evidence, not the law that made the change.
Revenue Act of 1962
Pub. L. 87–834 § 12(a) · 76 Stat. 960
Enacted · 26 U.S.C. § 951
Added Pub. L. 87–834, § 12(a), Oct. 16, 1962, 76 Stat. 1006
Source evidence
Code source credit
Added Pub. L. 87–834, § 12(a), Oct. 16, 1962, 76 Stat. 1006Tax Reduction Act of 1975
Pub. L. 94–12 § 602(a)(3)(B) · 89 Stat. 26
Struck · 26 U.S.C. § 951(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”
Source evidence
Code amendment note
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”.Enacted provision · exact public law section
(B) Subparagraph (A)(i) of section 951(a)(1) (relating to general rule for amounts included in gross income of United States shareholders) is amended Dy striking out “except as provided in section 963.”.Tax Reduction Act of 1975
Pub. L. 94–12 § 602(c)(3) · 89 Stat. 26
Substituted · 26 U.S.C. § 951(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))”
Source evidence
Code amendment note
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))”.Enacted provision · exact public law section
(3) Amendment of section 951(a)(1)(A)(ii).— Clause (ii) of section 951(a)(1)(A) is amended by striking out “(determined 26 USC 955. under section 955(a)(3))” and inserting in lieu thereof “(determined under section 955(a)(3) as in effect before the enactment of the Tax Reduction Act of 1975)”.Tax Reduction Act of 1975
Pub. L. 94–12 § 602(d)(2)(A) · 89 Stat. 26
Added · 26 U.S.C. § 951(a)(1)(A)(iii)
Pub. L. 94–12, § 602(d)(2)(A), added cl. (iii)
Source evidence
Code amendment note
Subsec. (a)(1)(A)(iii). Pub. L. 94–12, § 602(d)(2)(A), added cl. (iii).Enacted provision · exact public law section
(A) Subparagraph (A) of section 951(a)(1) is amended by striking out “and” at the end of clause (i), by striking out the semicolon at the end of clause (ii) and inserting in lieu thereof a comma, and by adding at the end thereof the following new clause: “(iii) his pro rata share (determined under section 955 (a)(3)) of the corporal ion’s previously excluded subpart F income withdrawn from foreign base company shipping operations for such year; and”.Tax Reduction Act of 1975
Pub. L. 94–12 § 602(c)(4) · 89 Stat. 26
Substituted · 26 U.S.C. § 951(a)(3)
Pub. L. 94–12, § 602(c)(4), (d)(2)(B), substituted “paragraph (i)(A)(iii)” for “paragraph (1)(A)(ii)”
Substituted · 26 U.S.C. § 951(a)(3)
Pub. L. 94–12, § 602(c)(4), (d)(2)(B), substituted “foreign base company shipping operations” for “less developed countries”
Source evidence
Code amendment note
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”.Enacted provision · exact public law section
(4) Repeal of section 951(a)(b).— Paragraph (3) of section 951(a) (relating to limitation on pro rata share of previously excluded subpart F income withdrawn from investment) is hereby repealed.Pub. L. 94–455 title XIX § 1901(a)(119) · 90 Stat. 1520
Struck · 26 U.S.C. § 951(a)(1)
Pub. L. 94–455 struck out “beginning after December 31, 1962” after “during any taxable year”
Source evidence
Code amendment note
Subsec. (a)(1). Pub. L. 94–455 struck out “beginning after December 31, 1962” after “during any taxable year”.Enacted provision · exact public law section
(119) Amendment of section 951.— Section 951 (a)(1) (relating to treatment, of subpart F income) is amended by striking out “beginning after December 31, 1962”.Tax Reform Act of 1984
Pub. L. 98–369 § 132(c)(1) · 98 Stat. 494
Amended · 26 U.S.C. § 951(d)
Pub. L. 98–369, § 132(c)(1), amended subsec. (d) generally
Substituted · 26 U.S.C. § 951(d)
Pub. L. 98–369, § 132(c)(1), 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
Source evidence
Code amendment note
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.Enacted provision · exact public law section
(1) In general.— Subsection (d) of section 951 (relating to coordination with foreign personal holding company provisions) is amended to read as follows: “(d) Coordination With Foreign Personal Holding Company Provisions.— 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 551(b) (relating to foreign personal holding company income included in gross income of United States shareholder), such amount shall be included in the gross income of such shareholder only under subsection (a)(1)(A).”Tax Reform Act of 1984
Pub. L. 98–369 § 801(d)(4) · 98 Stat. 494
Added · 26 U.S.C. § 951(e)
Pub. L. 98–369, § 801(d)(4), added subsec. (e)
Source evidence
Code amendment note
Subsec. (e). Pub. L. 98–369, § 801(d)(4), added subsec. (e).Enacted provision · exact public law section
(4) Section 951 (relating to amounts included in gross income of shareholders) is amended by adding at the end thereof the following new subsection: “(e) Foreign Trade Income Not Taken Into Account.— “(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. For purposes of the preceding sentence, income described in paragraph (2) or Ante, p. 985. (3) of section 921(d) shall be treated as derived from sources within the United States. “(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)).”.Tax Reform Act of 1986
Pub. L. 99–514 § 1876(c)(2) · 100 Stat. 2085
Struck · 26 U.S.C. § 951(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.”
Source evidence
Code amendment note
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.”Enacted provision · exact public law section
(2) Paragraph (1) of section 951(e) is amended by striking out the last sentence.Tax Reform Act of 1986
Pub. L. 99–514 § 1235(c) · 100 Stat. 2085
Added · 26 U.S.C. § 951(f)
Pub. L. 99–514, § 1235(c), added subsec. (f)
Source evidence
Code amendment note
Subsec. (f). Pub. L. 99–514, § 1235(c), added subsec. (f).Enacted provision · exact public law section
(c) Coordination With Subpart F.— Section 951 (relating to amounts included in gross income of United States shareholders) is amended by adding at the end thereof the following new subsection: “(c) Coordination With Passive Foreign Investment Company Provisions.— If, but for this subsection, an amount would be in-cluded 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).”Technical and Miscellaneous Revenue Act of 1988
Pub. L. 100–647 title I § 1012(i)(15) · 102 Stat. 3342
Substituted · 26 U.S.C. § 951(b)
Pub. L. 100–647 substituted “section 957(c)” for “section 957(d)”
Source evidence
Code amendment note
Subsec. (b). Pub. L. 100–647 substituted “section 957(c)” for “section 957(d)”.Enacted provision · exact public law section
(15) Subsection (b) of section 951 of the 1986 Code is amended by striking out “section 957(d)” and inserting in lieu thereof “section 957(c)”.Revenue Reconciliation Act of 1993
Pub. L. 103–66 § 13232(c)(1) · 107 Stat. 312
Substituted · 26 U.S.C. § 951(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”
Source evidence
Code amendment note
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”.Enacted provision · exact public law section
(1) 26 USC 951. Subparagraph (B) of section 951(a)(1) is amended to read as follows: “(B) 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”Revenue Reconciliation Act of 1993
Pub. L. 103–66 § 13231(a) · 107 Stat. 312
Added · 26 U.S.C. § 951(a)(1)(C)
Pub. L. 103–66, § 13231(a), added subpar. (C)
Source evidence
Code amendment note
Subsec. (a)(1)(C). Pub. L. 103–66, § 13231(a), added subpar. (C).Enacted provision · exact public law section
(a) General Rule.— Paragraph (1) of section 951(a) (relating to amounts included in gross income of United States shareholders) is amended by striking “and” at the end of subparagraph (A), by striking the period at the end of subparagraph (B) and inserting “; and”, and by adding at the end thereof the following new subparagraph: “(C) 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)).”Revenue Reconciliation Act of 1993
Pub. L. 103–66 § 13232(c)(2) · 107 Stat. 312
Struck · 26 U.S.C. § 951(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.”
Source evidence
Code amendment note
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.”Enacted provision · exact public law section
(2) Subsection (a) of section 951 is amended by striking paragraph (4).Small Business Job Protection Act of 1996
Pub. L. 104–188 title I § 1501(a)(1) · 110 Stat. 1755
Inserted · 26 U.S.C. § 951(a)(1)(A)(C)
Pub. L. 104–188 inserted “and” at end of subpar. (A)
Substituted · 26 U.S.C. § 951(a)(1)(A)(C)
Pub. L. 104–188 substituted period for “; and” at end of subpar. (B)
Struck · 26 U.S.C. § 951(a)(1)(A)(C)
Pub. L. 104–188 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)).”
Source evidence
Code amendment note
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)).”Enacted provision · exact public law section
(1) Repeal of inclusion.— Paragraph (1) of section 951(a) (relating to amounts included in gross income of United States shareholders) is amended by striking subparagraph (C), by striking “; and” at the end of subparagraph (B) and inserting a period, and by adding “and” at the end of subparagraph (A).Pub. L. 105–34 title XI § 1112(a)(1) · 111 Stat. 788
Inserted · 26 U.S.C. § 951(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.”
Source evidence
Code amendment note
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.”Enacted provision · exact public law section
(1) In general.— Paragraph (2) of section 951(a) (defining pro rata share of subpart F income) is amended by adding at the end thereof the following new sentence: “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.”.Pub. L. 108–357 title IV § 413(c)(16) · 118 Stat. 1418
Redesignated · 26 U.S.C. § 951(c)(f)
Pub. L. 108–357 redesignated subsecs. (e) and (f) as (c) and (d), respectively
Struck · 26 U.S.C. § 951(c)(f)
Pub. L. 108–357 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
Source evidence
Code amendment note
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.Enacted provision · exact public law section
(16) Section 951 is amended by striking subsections (c) and (d) and by redesignating subsections (e) and (f) as subsections (c) and (d), respectively.Tax Technical Corrections Act of 2007
Pub. L. 110–172 § 11(g)(13) · 121 Stat. 2473
Redesignated · 26 U.S.C. § 951(c); 26 U.S.C. § 951(d)
Pub. L. 110–172 redesignated subsec. (d) as (c)
Struck · 26 U.S.C. § 951(c); 26 U.S.C. § 951(d)
Pub. L. 110–172 struck out heading and text of former subsec. (c). Text read as follows:
Source evidence
Code amendment note
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)).”
Enacted provision · exact public law section
(13) Section 951 is amended by striking subsection (c) and by redesignating subsection (d) as subsection (c).Pub. L. 115–97 § 14215(a) · 131 Stat. 2054
Substituted · 26 U.S.C. § 951(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
Source evidence
Code amendment note
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.Enacted provision · exact public law section
(a) In General.— Section 951(a)(1) is amended by striking “for an uninterrupted period of 30 days or more” and inserting “at any time”.Pub. L. 115–97 § 14212(b)(1)(A) · 131 Stat. 2054
Amended · 26 U.S.C. § 951(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—
Source evidence
Code amendment note
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”.
Enacted provision · exact public law section
(A) Section 951(a)(1)(A) is amended to read as follows: “(A) his pro rata share (determined under paragraph (2)) of the corporation’s subpart F income for such year, and” .Pub. L. 115–97 § 14212(b)(2) · 131 Stat. 2054
Struck · 26 U.S.C. § 951(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—
Source evidence
Code amendment note
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.”
Enacted provision · exact public law section
(2) Section 951(a) is amended by striking paragraph (3).Pub. L. 115–97 § 14214(a) · 131 Stat. 2054
Inserted · 26 U.S.C. § 951(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”
Source evidence
Code amendment note
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”.Enacted provision · exact public law section
(a) In General.— Section 951(b) 26 USC 951. is amended by inserting “, 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) · 131 Stat. 2054
Substituted · 26 U.S.C. § 951(b)
Pub. L. 115–97, § 14101(e)(1), substituted “title” for “subpart”
Target inherited from the preceding amendment note.
Source evidence
Code amendment note
Pub. L. 115–97, § 14101(e)(1), substituted “title” for “subpart”.Enacted provision · exact public law section
(1) Subsection (b) of section 951 26 USC 951. is amended by striking “subpart” and inserting “title”.Pub. L. 119–21 title VII § 70354(a) · 139 Stat. 210
Amended · 26 U.S.C. § 951(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
Unresolved: Pub. L. 119–21 was not found in the local Statutes at Large index.
Source evidence
Code amendment note
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.Effective date note
Pub. L. 119–21, title VII, § 70354(c), July 4, 2025, 139 Stat. 212, provided that:
28 of 30 references resolved to an enrolled provision · 1 partial · 1 unresolved
Editorial Notes
Amendments1975–2025 · 12 rounds
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 ” 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), , 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 .
“(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 , 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 , or
“(ii) was paid (or deemed paid) after , and before such controlled foreign corporation’s first taxable year beginning after , 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 , 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 , 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), , 131 Stat. 2218, provided that: “The amendment made by this section [amending this section] shall apply 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.”
Pub. L. 115–97, title I, § 14215(b), , 131 Stat. 2218, provided that: “The amendment made by this section [amending this section] shall apply 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.”
Effective Date of 2004 Amendment
Amendment by Pub. L. 108–357 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 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), , 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 [].”
Effective Date of 1996 Amendment
Amendment by Pub. L. 104–188 applicable to taxable years of foreign corporations beginning after , 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), , 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 , 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), , 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 , 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 , 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), , 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 [].”
Amendment by section 801(d)(4) of Pub. L. 98–369 applicable to transactions after , 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 , 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), , 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 , 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 , see section 1140 of Pub. L. 99–514, as amended, set out as a note under section 401 of this title.
Credits
1962–2025 · 13 acts
- 1962Added Pub. L. 87–834, § 12(a), , 76 Stat. 1006
- 1975amended Pub. L. 94–12, title VI, § 602(a)(3)(B), (c)(3), (4), (d)(2), , 89 Stat. 58, 62
- 1976Pub. L. 94–455, title XIX, § 1901(a)(119), , 90 Stat. 1784
- 1984Pub. L. 98–369, div. A, title I, § 132(c)(1), title VIII, § 801(d)(4), , 98 Stat. 666, 996
- 1986Pub. L. 99–514, title XII, § 1235(c), title XVIII, § 1876(c)(2), , 100 Stat. 2574, 2898
- 1988Pub. L. 100–647, title I, § 1012(i)(15), , 102 Stat. 3510
- 1993Pub. L. 103–66, title XIII, §§ 13231(a), 13232(c), , 107 Stat. 495, 502
- 1996Pub. L. 104–188, title I, § 1501(a)(1), , 110 Stat. 1825
- 1997Pub. L. 105–34, title XI, § 1112(a)(1), , 111 Stat. 969
- 2004Pub. L. 108–357, title IV, § 413(c)(16), , 118 Stat. 1508
- 2007Pub. L. 110–172, § 11(g)(13), , 121 Stat. 2490
- 2017Pub. L. 115–97, title I, §§ 14101(e)(1), 14212(b)(1)(A), (2), 14214(a), 14215(a), , 131 Stat. 2192, 2217, 2218
- 2025Pub. L. 119–21, title VII, § 70354(a), , 139 Stat. 210.
Show as published
(Added Pub. L. 87–834, § 12(a), , 76 Stat. 1006; amended Pub. L. 94–12, title VI, § 602(a)(3)(B), (c)(3), (4), (d)(2), , 89 Stat. 58, 62; Pub. L. 94–455, title XIX, § 1901(a)(119), , 90 Stat. 1784; Pub. L. 98–369, div. A, title I, § 132(c)(1), title VIII, § 801(d)(4), , 98 Stat. 666, 996; Pub. L. 99–514, title XII, § 1235(c), title XVIII, § 1876(c)(2), , 100 Stat. 2574, 2898; Pub. L. 100–647, title I, § 1012(i)(15), , 102 Stat. 3510; Pub. L. 103–66, title XIII, §§ 13231(a), 13232(c), , 107 Stat. 495, 502; Pub. L. 104–188, title I, § 1501(a)(1), , 110 Stat. 1825; Pub. L. 105–34, title XI, § 1112(a)(1), , 111 Stat. 969; Pub. L. 108–357, title IV, § 413(c)(16), , 118 Stat. 1508; Pub. L. 110–172, § 11(g)(13), , 121 Stat. 2490; Pub. L. 115–97, title I, §§ 14101(e)(1), 14212(b)(1)(A), (2), 14214(a), 14215(a), , 131 Stat. 2192, 2217, 2218; Pub. L. 119–21, title VII, § 70354(a), , 139 Stat. 210.)