Page 175 - Tax Reform

PUBLIC LAW 115–97—DEC. 22, 2017 131 STAT. 2225

(38) The table of sections for subpart A of part III of
subchapter N of chapter 1 is amended by striking the item 26 USC 901 prec.
relating to section 902.
(39) The table of sections for subpart F of part III of
subchapter N of chapter 1 is amended by striking the item 26 USC 951 prec.
relating to section 960 and inserting the following:
‘‘Sec. 960. Deemed paid credit for subpart F inclusions.’’.
(d) EFFECTIVE DATE.—The amendments made by this section 26 USC 78 note.
shall apply to taxable years of foreign corporations beginning after
December 31, 2017, and to taxable years of United States share-
holders in which or with which such taxable years of foreign corpora-
tions end.
SEC. 14302. SEPARATE FOREIGN TAX CREDIT LIMITATION BASKET FOR
FOREIGN BRANCH INCOME.
(a) IN GENERAL.—Section 904(d)(1), as amended by section
14201, is amended by redesignating subparagraphs (B) and (C) 26 USC 904.
as subparagraphs (C) and (D), respectively, and by inserting after
subparagraph (A) the following new subparagraph:
‘‘(B) foreign branch income,’’.
(b) FOREIGN BRANCH INCOME.—
(1) IN GENERAL.—Section 904(d)(2) is amended by inserting
after subparagraph (I) the following new subparagraph:
‘‘(J) FOREIGN BRANCH INCOME.—
‘‘(i) IN GENERAL.—The term ‘foreign branch income’
means the business profits of such United States per-
son which are attributable to 1 or more qualified busi-
ness units (as defined in section 989(a)) in 1 or more
foreign countries. For purposes of the preceding sen-
tence, the amount of business profits attributable to
a qualified business unit shall be determined under
rules established by the Secretary.
‘‘(ii) EXCEPTION.—Such term shall not include any
income which is passive category income.’’.
(2) CONFORMING AMENDMENT.—Section 904(d)(2)(A)(ii), as
amended by section 14201, is amended by striking ‘‘income
described in paragraph (1)(A) and’’ and inserting ‘‘income
described in paragraph (1)(A), foreign branch income, and’’.
(c) EFFECTIVE DATE.—The amendments made by this section 26 USC 904 note.
shall apply to taxable years beginning after December 31, 2017.
SEC. 14303. SOURCE OF INCOME FROM SALES OF INVENTORY DETER-
MINED SOLELY ON BASIS OF PRODUCTION ACTIVITIES.
(a) IN GENERAL.—Section 863(b) is amended by adding at the
end the following: ‘‘Gains, profits, and income from the sale or
exchange of inventory property described in paragraph (2) shall
be allocated and apportioned between sources within and without
the United States solely on the basis of the production activities
with respect to the property.’’.
(b) EFFECTIVE DATE.—The amendment made by this section 26 USC 863 note.
shall apply to taxable years beginning after December 31, 2017.
SEC. 14304. ELECTION TO INCREASE PERCENTAGE OF DOMESTIC TAX-
ABLE INCOME OFFSET BY OVERALL DOMESTIC LOSS
TREATED AS FOREIGN SOURCE.
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(a) IN GENERAL.—Section 904(g) is amended by adding at the
end the following new paragraph: