§951B Amounts included in gross income of foreign controlled United States shareholders

Summary

It makes many of the tax rules that apply to U.S. shareholders also apply to U.S. persons who control foreign companies. Most of the rules in the subpart (except sections 951A, 951(b), and 957) are applied again for these people, but with “foreign controlled United States shareholder” put wherever “United States shareholder” appears and “foreign controlled foreign corporation” put wherever “controlled foreign corporation” appears. Section 951A is also applied so it includes these special shareholders and companies. A “foreign controlled United States shareholder” is a U.S. person who would be a U.S. shareholder if section 951(b) used “more than 50 percent” instead of “10 percent or more” and if section 958(b) ignored paragraph (4). A “foreign controlled foreign corporation” is a foreign company that is not a controlled foreign corporation now but would be one if section 957(a) used “foreign controlled United States shareholders” for “United States shareholders” and used section 958(b) other than paragraph (4). The Secretary must write rules and guidance to make this work, including treating these people and companies as U.S. shareholders or controlled foreign corporations for other tax rules and guidance for passive foreign investment companies under section 1297.