Editor's Note:
Pub. L. 115-97, Sec. 14212(a), struck Sec. 955, effective for taxable years of foreign corporations
beginning after December 31, 2017, and for taxable years of United States shareholders
in which or with which such taxable years of foreign corporations end.
I.R.C. § 955(a) General Rules —
Editor's Note:
Pub. L. 115-97, Sec. 14212(a), struck Sec. 955, effective for taxable years of foreign corporations
beginning after December 31, 2017, and for taxable years of United States shareholders
in which or with which such taxable years of foreign corporations end.
I.R.C. § 955(a)(1) Amount Withdrawn —
For purposes of this subpart, the amount of previously excluded subpart F income
of any controlled foreign corporation withdrawn from investment in foreign base company
shipping operations for any taxable year is an amount equal to the decrease in the
amount of qualified investments in foreign base company shipping operations of the
controlled foreign corporation for such year, but only to the extent that the amount
of such decrease does not exceed an amount equal to—
I.R.C. § 955(a)(1)(A) —
the sum of the amounts excluded under section 954(b)(2) from the foreign base company income of such corporation for all prior taxable
years beginning before 1987, reduced by
I.R.C. § 955(a)(1)(B) —
the sum of the amounts of previously excluded subpart F income withdrawn from investment
in foreign base company shipping operations of such corporation determined under
this subsection for all prior taxable years.
I.R.C. § 955(a)(2) Decrease In Qualified Investments —
For purposes of paragraph (1), the amount of the decrease in qualified investments
in foreign base company shipping operations of any controlled foreign corporation
for any taxable year is the amount by which—
I.R.C. § 955(a)(2)(A) —
the amount of qualified investments in foreign base company shipping operations of
the controlled foreign corporation as of the close of the last taxable year beginning
before 1987 (to the extent such amount exceeds the sum of the decreases in qualified
investments determined under this paragraph for prior taxable years beginning after
1986), exceeds
I.R.C. § 955(a)(2)(B) —
the amount of qualified investments in foreign base company shipping operations of
the controlled foreign corporation at the close of the taxable year,
to the extent that the amount of such decrease does not exceed the sum of the earnings
and profits for the taxable year and the earnings and profits accumulated for prior
taxable years beginning after December 31, 1975, and the amount of previously excluded
subpart F income invested in less developed country corporations described in section
955(c)(2) (as in effect before the enactment of the Tax Reduction Act of 1975) to the extent
attributable to earnings and profits accumulated for taxable years beginning after
December 31, 1962. For purposes of this paragraph, if qualified investments in foreign
base company shipping operations are disposed of by the controlled foreign corporation
during the taxable year, the amount of the decrease in qualified investments in foreign
base company shipping operations of such controlled foreign corporations for such
year shall be reduced by an amount equal to the amount (if any) by which the losses
on such dispositions during such year exceed the gains on such dispositions during
such year.
I.R.C. § 955(a)(3) Pro Rata Share Of Amount Withdrawn —
In the case of any United States shareholder, the pro rata share of the amount of
previously excluded subpart F income of any controlled foreign corporation withdrawn
from investment in foreign base company shipping operations for any taxable year
is his pro rata share of the amount determined under paragraph (1).
I.R.C. § 955(b) Qualified Investments In Foreign Base Company Shipping Operations —
Editor's Note:
Pub. L. 115-97, Sec. 14212(a), struck Sec. 955, effective for taxable years of foreign corporations
beginning after December 31, 2017, and for taxable years of United States shareholders
in which or with which such taxable years of foreign corporations end.
I.R.C. § 955(b)(1) In General —
For purposes of this subpart, the term “qualified investments in foreign base company
shipping operations” means investments in—
I.R.C. § 955(b)(1)(A) —
any aircraft or vessel used in foreign commerce, and
I.R.C. § 955(b)(1)(B) —
other assets which are used in connection with the performance of services directly
related to the use of any such aircraft or vessel.
Such term includes, but is not limited to, investments
by a controlled foreign corporation in stock or obligations of another
controlled foreign corporation which is a related person (within the meaning of section
954(d)(3))
and which holds assets described in the preceding sentence, but only to the extent
that such assets are so used.
I.R.C. § 955(b)(2) Qualified Investments By Related Persons —
For purposes of determining the amount of qualified investments in foreign based
company shipping operations, an investment
(or a decrease in investment) in such operations by one or more controlled foreign
corporations may, under regulations prescribed by the Secretary, be treated as an
investment (or a decrease in investment) by another
corporation which is a controlled foreign corporation and is a related
person (as defined in section 954(d)(3) with respect to the corporation actually making or withdrawing the investment.
I.R.C. § 955(b)(3) Special Rule —
For purposes of this subpart, a United States shareholder of a controlled foreign
corporation may, under regulations prescribed by the Secretary, elect to make the
determinations under subsection
(a)(2) of this section and under subsection (g) of section 954 as of the close of the years
following the years referred to in such subsections, or as of the close of such longer
period of time as such regulations may permit, in lieu of on the last day of such
years. Any election under this paragraph made with respect to any taxable year shall
apply to such year and to all succeeding taxable years unless the Secretary consents
to the revocation of such election.
I.R.C. § 955(b)(4) Amount Attributable To Property —
The amount taken into account under this subpart with respect to any property described
in paragraph (1) shall be its adjusted basis, reduced by any liability to which such
property is subject.
I.R.C. § 955(b)(5) Income Excluded Under Prior Law —
Amounts invested in less developed country corporations described in section 955(c)(2)
(as in effect before the enactment of the Tax Reduction Act of 1975) shall be treated
as qualified investments in foreign base company shipping operations and shall not
be treated as investments in less developed countries for purposes of section 951(a)(1)(A)(ii).
(Added Pub. L. 94-12, title VI, 602(d)(3)(A), Mar. 29, 1975, 89 Stat. 62, and amended Pub. L. 94-455, title XIX, 1906(b)(13)(A),
Oct. 4, 1976, 90 Stat. 1834; Pub. L. 99-514, title XII, 1221(c)(3)(B), (C), Oct. 22, 1986, 100 Stat. 2553; Pub. L. 100-647, title I, 1012(i)(11),
Nov. 10, 1988, 102 Stat. 3509, repealed by Pub. L. 115-97, title I, Sec. 14212(a), Dec. 22, 2017, 131 Stat. 2054.)
BACKGROUND NOTES
AMENDMENTS
2017 -
Sec. 955. Pub. L. 115-97, Sec. 14212(a), repealed Sec. 955. Before repeal, it read as follows:
“Sec. 955. Withdrawal Of Previously Excluded Subpart F Income From Qualified Investment
“(a) General Rules
“(1) Amount Withdrawn.—For purposes of this subpart, the amount of previously excluded
subpart F income of any controlled foreign corporation withdrawn from investment in
foreign base company shipping operations for any taxable year is an amount equal to
the decrease in the amount of qualified investments in foreign base company shipping
operations of the controlled foreign corporation for such year, but only to the extent
that the amount of such decrease does not exceed an amount equal to—
“(A) the sum of the amounts excluded under section 954(b)(2) from the foreign base
company income of such corporation for all prior taxable years beginning before 1987,
reduced by
“(B) the sum of the amounts of previously excluded subpart F income withdrawn from
investment in foreign base company shipping operations of such corporation determined
under this subsection for all prior taxable years.
“(2) Decrease In Qualified Investments.—For purposes of paragraph (1), the amount
of the decrease in qualified investments in foreign base company shipping operations
of any controlled foreign corporation for any taxable year is the amount by which—
“(A) the amount of qualified investments in foreign base company shipping operations
of the controlled foreign corporation as of the close of the last taxable year beginning
before 1987 (to the extent such amount exceeds the sum of the decreases in qualified
investments determined under this paragraph for prior taxable years beginning after
1986), exceeds
“(B) the amount of qualified investments in foreign base company shipping operations
of the controlled foreign corporation at the close of the taxable year,
“to the extent that the amount of such decrease does not exceed the sum of the earnings
and profits for the taxable year and the earnings and profits accumulated for prior
taxable years beginning after December 31, 1975, and the amount of previously excluded
subpart F income invested in less developed country corporations described in section
955(c)(2) (as in effect before the enactment of the Tax Reduction Act of 1975) to
the extent attributable to earnings and profits accumulated for taxable years beginning
after December 31, 1962. For purposes of this paragraph, if qualified investments
in foreign base company shipping operations are disposed of by the controlled foreign
corporation during the taxable year, the amount of the decrease in qualified investments
in foreign base company shipping operations of such controlled foreign corporations
for such year shall be reduced by an amount equal to the amount (if any) by which
the losses on such dispositions during such year exceed the gains on such dispositions
during such year.
“(3) Pro Rata Share Of Amount Withdrawn.—In the case of any United States shareholder,
the pro rata share of the amount of previously excluded subpart F income of any controlled
foreign corporation withdrawn from investment in foreign base company shipping operations
for any taxable year is his pro rata share of the amount determined under paragraph
(1).
“(b) Qualified Investments In Foreign Base Company Shipping Operations
“(1) In General.—For purposes of this subpart, the term “qualified investments in
foreign base company shipping operations” means investments in—
“(A) any aircraft or vessel used in foreign commerce, and
“(B) other assets which are used in connection with the performance of services
directly related to the use of any such aircraft or vessel.
“Such term includes, but is not limited to, investments by a controlled foreign corporation
in stock or obligations of another controlled foreign corporation which is a related
person
(within the meaning of section 954(d)(3)) and which holds assets described in the
preceding sentence, but only to the extent that such assets are so used.
“(2) Qualified Investments By Related Persons.—For purposes of determining the amount
of qualified investments in foreign based company shipping operations, an investment
(or a decrease in investment) in such operations by one or more controlled foreign
corporations may, under regulations prescribed by the Secretary, be treated as an
investment (or a decrease in investment) by another corporation which is a controlled
foreign corporation and is a related person
(as defined in section 954(d)(3) with respect to the corporation actually making or
withdrawing the investment.
“(3) Special Rule.—For purposes of this subpart, a United States shareholder of a
controlled foreign corporation may, under regulations prescribed by the Secretary,
elect to make the determinations under subsection (a)(2) of this section and under
subsection (g) of section 954 as of the close of the years following the years referred
to in such subsections, or as of the close of such longer period of time as such regulations
may permit, in lieu of on the last day of such years. Any election under this paragraph
made with respect to any taxable year shall apply to such year and to all succeeding
taxable years unless the Secretary consents to the revocation of such election.
“(4) Amount Attributable To Property.—The amount taken into account under this subpart
with respect to any property described in paragraph (1) shall be its adjusted basis,
reduced by any liability to which such property is subject.
“(5) Income Excluded Under Prior Law.—Amounts invested in less developed country corporations
described in section 955(c)(2) (as in effect before the enactment of the Tax Reduction
Act of 1975) shall be treated as qualified investments in foreign base company shipping
operations and shall not be treated as investments in less developed countries for
purposes of section 951(a)(1)(A)(ii).”
1988--Subsec.
(a)(2)(A). Pub. L. 100-647 inserted
“(to the extent such amount exceeds the sum of the decreases in qualified investments
determined under this paragraph for prior taxable years beginning after 1986)” after
“beginning before 1987”.
1986--Subsec.
(a)(1)(A). Pub. L. 99-514, 1221(c)(3)(B), inserted “beginning before 1987” after “all prior taxable years”.
Subsec. (a)(2)(A). Pub. L. 99-514, 1221(c)(3)(C), substituted
“as of the close of the last taxable year beginning before 1987” for
“at the close of the preceding taxable year”.
1976--Subsec.
(b)(2), (3). Pub. L. 94-455 struck out “or his delegate” after “Secretary” wherever appearing.
EFFECTIVE DATE OF REPEAL
Repeal by Pub. L. 115-97, Sec. 14212(a), effective for taxable years of foreign corporations beginning after
December 31, 2017, and for taxable years of United States shareholders in which or
with which such taxable years of 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 Pub. L. 99-514 applicable to taxable years of foreign corporations beginning after Dec. 31, 1986,
except as otherwise provided, see section 1221(g) of Pub. L. 99-514, set out as a note under section 954 of this title.
EFFECTIVE DATE
Section 602(f) of Pub. L. 94-12, as amended by Pub. L. 99-514, 2, Oct. 22, 1986, 100 Stat. 2095, provided that: “The amendments made by this section
[enacting this section, amending sections 851, 902, 951, and 954 of this title, and
repealing section 963 and former section 955 of this title] shall apply to taxable
years of foreign corporations beginning after December 31, 1975, and to taxable years
of United States shareholders (within the meaning of 951(b) of the Internal Revenue Code of 1986 [formerly I.R.C. 1954]) within which or with which such taxable years of such foreign corporations end.”
PRIOR PROVISIONS
A prior section 955, added Pub. L. 87-834, 12(a), Oct. 16, 1962, 76 Stat. 1013, covering investments in less developed countries
and dealing with less developed country corporations, was repealed by Pub. L. 94-12, title VI, 602(c)(5), Mar. 29, 1975, 89 Stat. 59.
