I.R.C. § 1354(a) In General —
A qualifying vessel operator may elect the application of this subchapter.
I.R.C. § 1354(b) Time And Manner; Years For Which Effective —
An election under this subchapter—
I.R.C. § 1354(b)(1) —
shall be made in such form as prescribed by the Secretary, and
I.R.C. § 1354(b)(2) —
shall be effective for the taxable year for which made and all succeeding taxable
years until terminated under subsection (d).
Such election may be effective for any taxable year only if made on or before the
due date (including extensions) for filing the corporation's return for such taxable
year.
I.R.C. § 1354(c) Consistent Elections By Members Of Controlled Groups —
An election under subsection (a) by a member of a controlled group shall apply to
all qualifying vessel operators that are members of such group.
I.R.C. § 1354(d) Termination
I.R.C. § 1354(d)(1) By Revocation
I.R.C. § 1354(d)(1)(A) In General —
An election under subsection (a) may be terminated by revocation.
I.R.C. § 1354(d)(1)(B) When Effective —
Except as provided in subparagraph (C)—
I.R.C. § 1354(d)(1)(B)(i) —
Editor's Note: Sec. 1354(d)(1)(B)(i), below, was amended by Pub. L. No. 114-41, Sec. 2006(a)(2)(C), by substituting “4th month” for “3d month”
effective for taxable years beginning after Dec. 31, 2015, and, with respect to C
corporations with a taxable year ending on June 30, returns for taxable years beginning
after Dec. 31, 2025.
a revocation made during the taxable year and on or before the 15th day of the 4th
month thereof shall be effective on the 1st day of such taxable year, and
I.R.C. § 1354(d)(1)(B)(ii) —
a revocation made during the taxable year but after such 15th day shall be effective
on the 1st day of the following taxable year.
I.R.C. § 1354(d)(1)(C) Revocation May Specify Prospective Date —
If the revocation specifies a date for revocation which is on or after the day on
which the revocation is made, the revocation shall be effective for taxable years
beginning on and after the date so specified.
I.R.C. § 1354(d)(2) By Person Ceasing To Be Qualifying Vessel Operator
I.R.C. § 1354(d)(2)(A) In General —
An election under subsection (a) shall be terminated whenever (at any time on or
after the 1st day of the 1st taxable year for which the corporation is an electing
corporation) such corporation ceases to be a qualifying vessel operator.
I.R.C. § 1354(d)(2)(B) When Effective —
Any termination under this paragraph shall be effective on and after the date of
cessation.
I.R.C. § 1354(d)(2)(C) Annualization —
The Secretary shall prescribe such annualization and other rules as are appropriate
in the case of a termination under this paragraph.
I.R.C. § 1354(e) Election After Termination —
If a qualifying vessel operator has made an election under subsection (a) and if
such election has been terminated under subsection (d), such operator (and any successor
operator) shall not be eligible to make an election under subsection (a) for any
taxable year before its 5th taxable year which begins after the 1st taxable year
for which such termination is effective, unless the Secretary consents to such election.
(Added by Pub. L. 108-357, title II, Sec. 248(a), Oct. 22, 2004, 118 Stat. 1418; amended by Pub. L. 109-135, title IV, Sec. 403(g)(4), Dec. 21, 2005, 119 Stat. 2577; Pub. L. 114-41, title II, Sec. 2006(a)(2)(C), July 31, 2015, 129 Stat. 443.)
BACKGROUND NOTES
AMENDMENTS
2015 — Subsec. (d)(1)(B)(i). Pub. L. 114-41, Sec. 2006(a)(2)(C), amended clause (i) by substituting “4th month” for “3d month”.
2005 — Subsec. (b). Pub. L. 109-135, Sec. 403(g)(4), amended the last sentence of subsec. (b) by inserting “on or"
after “only if made”.
EFFECTIVE DATE OF 2015 AMENDMENT
Amendment by Pub. L. 114-41, Sec. 2006(a)(2)(A), effective for returns for taxable years beginning after December 31, 2015. Section
2006(a)(3)(B), provided the following special rule:
“(B)
SPECIAL RULE FOR C CORPORATIONS WITH FISCAL YEARS ENDING ON JUNE 30.—In the case of
any C corporation with a taxable year ending on June 30, the amendments made by this
subsection shall apply to returns for taxable years beginning after December 31, 2025.”
EFFECTIVE DATE OF 2005 AMENDMENT
Amendment by Sec. 403(g)(4) of Pub. L. 109-135 effective as if included in the provisions of the American Jobs Creation Act of 2004
[Pub. L. 108-357, Sec. 248]
to which it relates.
EFFECTIVE DATE
Effective for taxable years beginning after the date of the enactment of this Act
[Oct. 22, 2004.]
