Page 749 - Large Business IRS Training Guides

Section 965(g): Applicable Percentage (cont’d)

• Special
rules ensure that there is a disallowance of a portion of the
However, the disallowance is not exactly the
section 78 gross-up.
the disallowance for the deemed paid taxes.
same as

• A taxpayer electing FTCs includes in gross income under section
amounts equal to the deemed paid taxes multiplied by the
78 only
following ratio:

(Section 965(a)
inclusion – section 965(c) deduction)

Section 965(a)
inclusion

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