Sec. 138123. Modifications of foreign tax credit rules applicable to certain taxpayers receiving specific economic benefits
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/bill/117/hr/5376/eh/section-138123·A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Section 901 is amended by redesignating subsection
(n)as subsection
(o)and by inserting after subsection
(m)the following new subsection: Notwithstanding any other provision of this chapter, any amount paid or accrued by a dual capacity taxpayer to a foreign country or possession of the United States for any period shall not be considered a tax— if, for such period, the foreign country or possession does not impose a generally applicable income tax, or to the extent such amount exceeds the amount which would be paid or accrued by such dual capacity taxpayer under the generally applicable income tax imposed by such country or possession if such taxpayer were not a dual capacity taxpayer. Nothing in this paragraph shall be construed to imply the proper treatment of any such amount not in excess of the amount determined under subparagraph (B). For purposes of this subsection, the term dual capacity taxpayer means, with respect to any foreign country or possession of the United States, a person who— is subject to a levy of such country or possession, and receives (or will receive) directly or indirectly a specific economic benefit from such country or possession (or any political subdivision, agency, or instrumentality thereof). For purposes of this subsection, the term generally applicable income tax means an income tax (or a series of income taxes) which is generally imposed under the laws of a foreign country or possession of the United States on residents of such foreign country or possession that are not dual capacity taxpayers. . The amendments made by this section shall apply to amounts paid or accrued after December 31, 2021.