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TITLE 26-INTERNAL REVENUE CODE out as an Effective Date note under section 1351 of this title. Addition of par. (4) of subsec. (b), redesignation of former par. (4) as par. (5), and amendment of par. (5) as so redesignated by section 106(a)(4). (5) of Pub. L. 89-809 applicable with respect to taxable years begin- ning after Dec. 31, 1966, see section 106(a)(6) of Pub. L. 89-809, set out as an Effective Date of 1966 Amend- ment note under section 874 of this title. Section 106(b)(4) of Pub. L. 89-809 provided that: "The amendments made by this subsection (other than paragraph (3)) [amending par. (3) of subsec. (b), adding subsec. (c), and redesignating former subsecs. (c) and (d) as (d) and (e), respectively) shall apply with respect to taxable yearE beginning after Decem- ber 31, 1966. The amendment made by paragraph (3) [amending section 2014(a) and adding section 2014(h) of this title] shall apply with respect to estates of de. cedents dying after the date of enactment of this Act [November 13, 1966]." EFFECTIVE DATE OF 1964 AMENDMENT Amendment by Pub. L. 88-272, applicable to taxable years beginning after Dec. 31, 1963, see section 207(c) of Pub. L. 88-272, set out as an Effective Date of 1964 Amendment note under section 164 of this title. EFFECTIVE DATE OF 1962 AMENDMENT Amendment of subsec. (a) by Pub. L. 87-834 applica- ble with respect to taxable years of foreign corpora- tions beginning after Dec. 31, 1962, and to taxable years of United States shareholders within which or with which such taxable years of such foreign corpo- rations end, see section 12(c) of Pub. L. 87-834, set out as an Effective Date note under section 951 of this title. EFFECTIVE DATE OF 1960 AMENDMENT Amendment of subsecs. (a) and (b) by section 3(a) of Pub. L. 86-780 applicable to taxable years beginning after Dec. 31, 1960, and amendment of subsec. (a) by section 3(b) of Pub. L. 86-780 applicable to taxable years beginning after Dec. 31, 1953, and ending after Aug. 16, 1954, see section 4 of Pub. L. 86-780, set out as an Effective Date of 1960 Amendment note under sec- tion 904 of this title. ECONOMICALLY LESS DEVELOPED COUNTRIES Designation of certain foreign countries as economi- cally less developed countries, see Ex. Ord. No. 11071, Dec. 27, 1962, 27 F.R. 12875, set out as a note under section 955 of this title. CROSS REFERENCES Credit for foreign taxes, see section 841 of this title. Disallowance of foreign tax credit, see section 942 of this title. Foreign tax credit, applicable rules, see section 905 of this title. Income from sources within possessions of the United States, foreign tax credit, see section 931 of this title. Investment companies, foreign tax credit allowed to shareholder, see section 853 of this title. Limitations, special rules relating to foreign tax credit, see section 6511 of this title. Nonresident aliens, foreign tax credit not allowed, see section 874 of this title. Partners and partnerships, taxes paid or accrued to foreign countries and possessions of the United States, see section 702 of this title. Tax on resident foreign corporations, foreign tax credit, see section 882 of this title. Taxes of foreign countries and possessions of the United States, see sections 33 and 515 of this title. SECTION REFERRED TO IN OTHER SECTIONS This section is referred to in sections 33, 243, 275, 515, 642, 702, 703, 841, 853, 874, 882, 904 to 908, 931, 960, 1247, 1503, 6038, 6511 of this title. § 902. Credit for corporate stockholder in foreign cor- poration (a) Treatment of taxes paid by foreign corporation For purposes of this subpart, a domestic cor- poration which owns at least 10 percent of the voting stock of a foreign corporation from which it receives dividends in any taxable year shall be deemed to have paid the same propor- tion of any income, war profits, or excess prof- its taxes paid or deemed to be paid by such for- eign corporation to any foreign country or to any pos3ession of the United States, on or with respect to the accumulated profits of such for- eign corporation from which such dividends were paid, which the amount of such dividends (determined without regard to section 78) bears to the amount of such accumulated profits in excess of such income, war profits, and excess profits taxes (other than those deemed paid). (b) Foreign subsidiary of first and second foreign corporation (1) One tier If the foreign corporation described in sub- section (a) (hereinafter in this subsection re- ferred to as the "first foreign corporation") owns 10 percent or more of the voting stock of a second foreign corporation from which it receives dividends in any taxable year, it shall be deemed to have paid the same proportion of any income, war profits, or excess profits taxes paid or deemed to be paid by such second foreign corporation to any foreign country or to any possession of the United States, on or with respect to the accumulated profits of such second foreign corporation from which such dividends were paid, which the amount of such dividends bears to the amount of such accumulated profits in excess of such income, war profits, and excess profits taxes (other than those deemed paid). (2) Two tiers If such first foreign corporation owns 10 percent or more of the voting stock of a second foreign corporation which, in turn, owns 30 percent or more of the voting stock of a third foreign corporation from which the second foreign corporation receives dividends in any taxable year, the second foreign corpo- ration shall be deemed to have paid the same proportion of any income, war profits, or excess profits taxes paid by such third foreign corporation to any foreign country or to any possession of the United States, on or with re- spect to the accumulated profits of such third foreign corporation from which such divi- dends were paid, which the amount of such dividends bears to the amount of such accu- mulated profits in excess of such income, war profits, and excess profits taxes. (3) Voting stock requirement For purposes of this subpart- (A) paragraph (1) shall not apply unless the percentage of voting stock owned by the domestic corporation in the first foreign corporation and the percentage of voting stock owned by the first foreign corporation in the second foreign corporation when multiplied together equal at least 5 percent, and Page 57/8 § 902