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131 STAT. 2190 PUBLIC LAW 115–97—DEC. 22, 2017 ‘‘(A) income described in subparagraph (A) of section 245(a)(5), nor ‘‘(B) dividends described in subparagraph (B) of such section (determined without regard to section 245(a)(12)). ‘‘(d) DISALLOWANCE OF FOREIGN TAX CREDIT, ETC.— ‘‘(1) IN GENERAL.—No credit shall be allowed under section 901 for any taxes paid or accrued (or treated as paid or accrued) with respect to any dividend for which a deduction is allowed under this section. ‘‘(2) DENIAL OF DEDUCTION.—No deduction shall be allowed under this chapter for any tax for which credit is not allowable under section 901 by reason of paragraph (1) (determined by treating the taxpayer as having elected the benefits of subpart A of part III of subchapter N). ‘‘(e) SPECIAL RULES FOR HYBRID DIVIDENDS.— ‘‘(1) IN GENERAL.—Subsection (a) shall not apply to any dividend received by a United States shareholder from a con- trolled foreign corporation if the dividend is a hybrid dividend. ‘‘(2) HYBRID DIVIDENDS OF TIERED CORPORATIONS.—If a con- trolled foreign corporation with respect to which a domestic corporation is a United States shareholder receives a hybrid dividend from any other controlled foreign corporation with respect to which such domestic corporation is also a United States shareholder, then, notwithstanding any other provision of this title— ‘‘(A) the hybrid dividend shall be treated for purposes of section 951(a)(1)(A) as subpart F income of the receiving controlled foreign corporation for the taxable year of the controlled foreign corporation in which the dividend was received, and ‘‘(B) the United States shareholder shall include in gross income an amount equal to the shareholder’s pro rata share (determined in the same manner as under sec- tion 951(a)(2)) of the subpart F income described in subparagraph (A). ‘‘(3) DENIAL OF FOREIGN TAX CREDIT, ETC.—The rules of subsection (d) shall apply to any hybrid dividend received by, or any amount included under paragraph (2) in the gross income of, a United States shareholder. ‘‘(4) HYBRID DIVIDEND.—The term ‘hybrid dividend’ means an amount received from a controlled foreign corporation— ‘‘(A) for which a deduction would be allowed under subsection (a) but for this subsection, and ‘‘(B) for which the controlled foreign corporation received a deduction (or other tax benefit) with respect to any income, war profits, or excess profits taxes imposed by any foreign country or possession of the United States. ‘‘(f) SPECIAL RULE FOR PURGING DISTRIBUTIONS OF PASSIVE FOREIGN INVESTMENT COMPANIES.—Any amount which is treated as a dividend under section 1291(d)(2)(B) shall not be treated as a dividend for purposes of this section. ‘‘(g) REGULATIONS.—The Secretary shall prescribe such regula- tions or other guidance as may be necessary or appropriate to carry out the provisions of this section, including regulations for the treatment of United States shareholders owning stock of a specified 10 percent owned foreign corporation through a partner- ship.’’. VerDate Sep 11 2014 10:09 Oct 18, 2018 Jkt 079139 PO 00097 Frm 00138 Fmt 6580 Sfmt 6581 E:\PUBLAW\PUBL097.115 PUBL097 dkrause on DSKBC28HB2PROD with PUBLAWS