Page 142 - Tax Reform

131 STAT. 2192 PUBLIC LAW 115–97—DEC. 22, 2017

Any term which is used in section 245A and in this paragraph
shall have the same meaning for purposes of this paragraph
as when used in such section.’’.
(e) CONFORMING AMENDMENTS.—
26 USC 951. (1) Subsection (b) of section 951 is amended by striking
‘‘subpart’’ and inserting ‘‘title’’.
(2) Subsection (a) of section 957 is amended by striking
‘‘subpart’’ in the matter preceding paragraph (1) and inserting
‘‘title’’.
(3) The table of sections for part VIII of subchapter B
26 USC 241 prec. of chapter 1 is amended by inserting after the item relating
to section 245 the following new item:
‘‘Sec. 245A. Deduction for foreign source-portion of dividends received by domestic
corporations from certain 10-percent owned foreign corporations.’’.
26 USC 245A (f) EFFECTIVE DATE.—The amendments made by this section
note. shall apply to distributions made after (and, in the case of the
amendments made by subsection (d), deductions with respect to
taxable years ending after) December 31, 2017.
SEC. 14102. SPECIAL RULES RELATING TO SALES OR TRANSFERS
INVOLVING SPECIFIED 10-PERCENT OWNED FOREIGN
CORPORATIONS.
(a) SALES BY UNITED STATES PERSONS OF STOCK.—
(1) IN GENERAL.—Section 1248 is amended by redesignating
subsection (j) as subsection (k) and by inserting after subsection
(i) the following new subsection:
‘‘(j) COORDINATION WITH DIVIDENDS RECEIVED DEDUCTION.—
In the case of the sale or exchange by a domestic corporation
of stock in a foreign corporation held for 1 year or more, any
amount received by the domestic corporation which is treated as
a dividend by reason of this section shall be treated as a dividend
for purposes of applying section 245A.’’.
26 USC 1248 (2) EFFECTIVE DATE.—The amendments made by this sub-
note. section shall apply to sales or exchanges after December 31,
2017.
(b) BASIS IN SPECIFIED 10-PERCENT OWNED FOREIGN CORPORA-
TION REDUCED BY NONTAXED PORTION OF DIVIDEND FOR PURPOSES
OF DETERMINING LOSS.—
(1) IN GENERAL.—Section 961 is amended by adding at
the end the following new subsection:
‘‘(d) BASIS IN SPECIFIED 10-PERCENT OWNED FOREIGN CORPORA-
TION REDUCED BY NONTAXED PORTION OF DIVIDEND FOR PURPOSES
OF DETERMINING LOSS.—If a domestic corporation received a divi-
dend from a specified 10-percent owned foreign corporation (as
defined in section 245A) in any taxable year, solely for purposes
of determining loss on any disposition of stock of such foreign
corporation in such taxable year or any subsequent taxable year,
the basis of such domestic corporation in such stock shall be reduced
(but not below zero) by the amount of any deduction allowable
to such domestic corporation under section 245A with respect to
such stock except to the extent such basis was reduced under
section 1059 by reason of a dividend for which such a deduction
was allowable.’’.
26 USC 961 note. (2) EFFECTIVE DATE.—The amendments made by this sub-
section shall apply to distributions made after December 31,
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2017.
(c) SALE BY A CFC OF A LOWER TIER CFC.—