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26 U.S.C. § 1295 — Qualified electing fund
Federal law — U.S. Code and appendices · legal_authorities
**(a) General rule** For purposes of this part, any passive foreign investment company shall be treated as a qualified electing fund with respect to the taxpayer if—
(1) an election by the taxpayer under subsection (b) applies to such company for the taxable year, and
(2) such company complies with such requirements as the Secretary may prescribe for purposes of—
(A) determining the ordinary earnings and net capital gain of such company, and
(B) otherwise carrying out the purposes of this subpart.
**(b) Election**
(1) **In general** — A taxpayer may make an election under this subsection with respect to any passive foreign investment company for any taxable year of the taxpayer. Such an election, once made with respect to any company, shall apply to all subsequent taxable years of the taxpayer with respect to such company unless revoked by the taxpayer with the consent of the Secretary.
(2) **When made** — An election under this subsection may be made for any taxable year at any time on or before the due date (determined with regard to extensions) for filing the return of the tax imposed by this chapter for such taxable year. To the extent provided in regulations, such an election may be made later than as required in the preceding sentence where the taxpayer fails to make a timely election because the taxpayer reasonably believed that the company was not a passive foreign investment company.
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Source file: Laws/federal/codes/united-states-code/title-26/section-1295-qualified-electing-fund--afdd24cc36.md
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Source location: Title 26, Chapter 1, § 1295; chapter-001-normal-taxes-and-surtaxes.md
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**(a) General rule** For purposes of this part, any passive foreign investment company shall be treated as a qualified electing fund with respect to the taxpayer if—
(1) an election by the taxpayer under subsection (b) applies to such company for the taxable year, and
(2) such company complies with such requirements as the Secretary may prescribe for purposes of—
(A) determining the ordinary earnings and net capital gain of such company, and
(B) otherwise carrying out the purposes of this subpart.
**(b) Election**
(1) **In general** — A taxpayer may make an election under this subsection with respect to any passive foreign investment company for any taxable year of the taxpayer. Such an election, once made with respect to any company, shall apply to all subsequent taxable years of the taxpayer with respect to such company unless revoked by the taxpayer with the consent of the Secretary.
(2) **When made** — An election under this subsection may be made for any taxable year at any time on or before the due date (determined with regard to extensions) for filing the return of the tax imposed by this chapter for such taxable year. To the extent provided in regulations, such an election may be made later than as required in the preceding sentence where the taxpayer fails to make a timely election because the taxpayer reasonably believed that the company was not a passive foreign investment company.
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Treatment of distributions and stock dispositions**
(1) **Distributions** — If a United States person receives an excess distribution in respect of stock in a passive foreign investment company, then—
(A) the amount of the excess distribution shall be allocated ratably to each day in the taxpayer’s holding period for the stock,
(B) with respect to such excess distribution, the taxpayer’s gross income for the current year shall include (as ordinary income) only the amounts allocated under subparagraph (A) to—
(i) the current year, or
(ii) any period in the taxpayer’s holding period before the 1st day of the 1st taxable year of the company which begins after December 31, 1986, and for which it was a passive foreign investment company, and
(C) the tax imposed by this chapter for the current year shall be increased by the deferred tax amount (determined under subsection (c)).
(2) **Dispositions** — If the taxpayer disposes of stock in a passive foreign investment company, then the rules of paragraph (1) shall apply to any gain recognized on such disposition in the same manner as if such gain were an excess distribution.
(3) **Definitions** — For purposes of this section—
(A) *Holding period* — The taxpayer’s holding period shall be determined under section 1223; except that—
(i) for purposes of applying this section to an excess distribution, such holding period shall be treated as ending on the date of such distribution, and
(ii) if section 1296 applied to such stock with respect to the taxpayer for any prior taxable year, such holding period shall be treated as beginning on the first day of the first taxable year beginning after the last taxable year for which section 1296 so applied.
(B) *Current year* — The term “current year”
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 1291
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Married individuals filing joint returns and surviving spouses** There is hereby imposed on the taxable income of—
(1) every married individual (as defined in section 7703) who makes a single return jointly with his spouse under section 6013, and
(2) every surviving spouse (as defined in section 2(a)),
a tax determined in accordance with the following table: If taxable income is:The tax is: Not over $36,90015% of taxable income. Over $36,900 but not over $89,150$5,535, plus 28% of the excess over $36,900. Over $89,150 but not over $140,000$20,165, plus 31% of the excess over $89,150. Over $140,000 but not over $250,000$35,928.50, plus 36% of the excess over $140,000. Over $250,000$75,528.50, plus 39.6% of the excess over $250,000.
**(b) Heads of households** There is hereby imposed on the taxable income of every head of a household (as defined in section 2(b)) a tax determined in accordance with the following table: If taxable income is:The tax is: Not over $29,60015% of taxable income. Over $29,600 but not over $76,400$4,440, plus 28% of the excess over $29,600. Over $76,400 but not over $127,500$17,544, plus 31% of the excess over $76,400. Over $127,500 but not over $250,000$33,385, plus 36% of the excess over $127,500. Over $250,000$77,485, plus 39.6% of the excess over $250,000.
**(c) Unmarried individuals (other than surviving spouses and heads of households)** There is hereby imposed on the taxable income of every individual (other than a surviving spouse as defined in section 2(a) or the head of a household as defined in section 2(b)) who is not a married individual (as defined in section 7703) a tax determined in accordance with the following table: If taxable income is:The tax is: Not over $22,10015% of taxable income. Over $22,100 but not over $53,50
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 1
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Federal law — U.S. Code and appendices · legal_authorities
Page 2413
TITLE 26—INTERNAL REVENUE CODE
§ 1295
(f) Treatment of loans to shareholder
For purposes of this section and section 1293,
any loan by a qualified electing fund (directly or
indirectly) to a shareholder of such fund shall be
treated as a distribution to such shareholder.
(g) Cross reference
For provisions providing for interest for the pe-
riod of the extension under this section, see section
6601.
(Added Pub. L. 99–514, title XII, § 1235(a), Oct. 22,
1986, 100 Stat. 2570; amended Pub. L. 100–647, title
I, § 1012(p)(4), (8), (25), (34), Nov. 10, 1988, 102 Stat.
3515, 3517, 3519, 3522; Pub. L. 108–357, title IV,
§ 413(c)(25), Oct. 22, 2004, 118 Stat. 1509.)
Editorial Notes
AMENDMENTS
2004—Subsec. (a)(2). Pub. L. 108–357 amended heading
and text of par. (2) generally. Prior to amendment, text
read as follows: ‘‘The taxpayer may not make an elec-
tion under paragraph (1) with respect to the undistrib-
uted PFIC earnings tax liability attributable to a
qualified electing fund for the taxable year if—
‘‘(A) any amount is includible in the gross income
of the taxpayer under section 551 with respect to such
fund for such taxable year, or
‘‘(B) any amount is includible in the gross income
of the taxpayer under section 951 with respect to such
fund for such taxable year.’’
1988—Subsec. (c)(2). Pub. L. 100–647, § 1012(p)(4), (34),
substituted ‘‘Transfers’’ for ‘‘Dispositions’’ in heading
and ‘‘is transferred’’ for ‘‘is disposed of’’ in subpar. (A),
and in closing provisions substituted ‘‘such transfer’’
for ‘‘such disposition’’ in two places and inserted at end
‘‘To the extent provided in regulations, the preceding
sentence shall not apply in the case of a transfer in a
transaction with respect to which gain or loss is not
recognized (in wh
Source: Supplied 2024 U.S. Code historical extraction · 26 U.S.C. § 1295
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