Page:United States Statutes at Large Volume 76.djvu/1072

 1024

PUBLIC LAW 87-834-OCT. 16, 1962

[76 STAT.

imum distribution of the consolidated earnings and profits for the taxable year of all such controlled foreign corporations. "(b) MINIMUM DISTRIBUTIONS.—For purposes of this section, a minimum distribution with respect to the earnings and profits for the taxable year of any controlled foreign corporation or corporations shall, in the case of a n j United States shareholder, be its pro rata share of an amount determined in accordance with the following table: "If the effective foreign tax rate is (percentage) — Under 10 10 or over but less than 20 20 or over but less than 28 28 or over but less than 34 34 or over but less than 39 39 or over but less than 42 42 or over but less than 44 44 or over but less than 46 46 or over but less than 47 47 or over

The required minimum distribution of earnings and profits is (percentage) — 90 86 82 75 68 55 40 27 14 0

"(c) AMGIFNTS TO W H I C H SECTION APPLIES.— "(1) FOREIGN SUBSIDIARIES.—Subsection (a)(1) shall apply to

Ante, p. 1006. Ante, p. 1018.

amounts which (but for the provisions of this section) would be included in the gross income of the United States shareholder under section 951(a)(1)(A)(i) by reason of its ownership, withiu the meaning of section 958(a)(1)(A), of stock of a controlled foreign corporation. " (2) C H A I N OF CONTROLLED FOREIGN CORPORATIONS.—Subsection

(a)(2) shall apply to amounts which (but for the provisions of this section) would be included in the gross income of the United States shareholder under section 951(a)(l)(A)(i) — " (A) by reason of its ownership, within the meaning of section 958(a)(1)(A), of stock of a controlled foreign corporation, and " (B) to the extent that the United States shareholder so elects, by reason of its ownership, within the meaning of section 958(a)(2), of stock of any other controlled foreign corporation (on account of its ownership of the stock described in subparagraph (A) or of stock described in this subparagraph), but only if there is taken into account the earnings and profits of each foreign corporation, whether or not a controlled foreign corporation, by reason of which the United States shareholder owns, within the meaning of section 958(a)(2), stock of such controlled foreign corporation. "(3) A L L CONTROLLED FOREIGN CORPORATIONS.—Except as provided in paragraph (4), subsection (a)(3) shall apply to amounts which (but for the provisions of this section) would be included in the gross income of the United States shareholder under section 951(a)(1)(A)(i) — " (A) by reason of its ownership, within the meaning of section 958(a)(1)(A), of stock of all controlled foreign corporations in which it owns stock within the meaning of such section, and ^ " (B) by reason of its ownership, within the meaning of section 958 (^a)(2), of stock of all controlled foreign corporations in which it owns stock within the meaning of such section, but only if there is taken into account the earnings and profits of each foreign corporation, whether or not a controlled foreign corporation, by reason of which the United States shareholder owns, within the meaning of section 958(a), stock of any of such controlled foreign corporations.

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