Page 161

131 STAT. 2213 PUBLIC LAW 115–97—DEC. 22, 2017 (c) CLERICAL AMENDMENT.—The table of sections for subpart F of part III of subchapter N of chapter 1 is amended by inserting after the item relating to section 951 the following new item: ‘‘Sec. 951A. Global intangible low-taxed income included in gross income of United States shareholders.’’. (d) EFFECTIVE DATE.—The amendments made by this section shall apply to taxable years of foreign corporations beginning after December 31, 2017, and to taxable years of United States share- holders in which or with which such taxable years of foreign corpora- tions end. SEC. 14202. DEDUCTION FOR FOREIGN-DERIVED INTANGIBLE INCOME AND GLOBAL INTANGIBLE LOW-TAXED INCOME. (a) IN GENERAL.—Part VIII of subchapter B of chapter 1 is amended by adding at the end the following new section: ‘‘SEC. 250. FOREIGN-DERIVED INTANGIBLE INCOME AND GLOBAL INTANGIBLE LOW-TAXED INCOME. ‘‘(a) ALLOWANCE OF DEDUCTION.— ‘‘(1) IN GENERAL.—In the case of a domestic corporation for any taxable year, there shall be allowed as a deduction an amount equal to the sum of— ‘‘(A) 37.5 percent of the foreign-derived intangible income of such domestic corporation for such taxable year, plus ‘‘(B) 50 percent of— ‘‘(i) the global intangible low-taxed income amount (if any) which is included in the gross income of such domestic corporation under section 951A for such tax- able year, and ‘‘(ii) the amount treated as a dividend received by such corporation under section 78 which is attrib- utable to the amount described in clause (i). ‘‘(2) LIMITATION BASED ON TAXABLE INCOME.— ‘‘(A) IN GENERAL.—If, for any taxable year— ‘‘(i) the sum of the foreign-derived intangible income and the global intangible low-taxed income amount otherwise taken into account by the domestic corporation under paragraph (1), exceeds ‘‘(ii) the taxable income of the domestic corporation (determined without regard to this section), then the amount of the foreign-derived intangible income and the global intangible low-taxed income amount so taken into account shall be reduced as provided in subpara- graph (B). ‘‘(B) REDUCTION.—For purposes of subparagraph (A)— ‘‘(i) foreign-derived intangible income shall be reduced by an amount which bears the same ratio to the excess described in subparagraph (A) as such foreign-derived intangible income bears to the sum described in subparagraph (A)(i), and ‘‘(ii) the global intangible low-taxed income amount shall be reduced by the remainder of such excess. ‘‘(3) REDUCTION IN DEDUCTION FOR TAXABLE YEARS AFTER 2025.—In the case of any taxable year beginning after December 31, 2025, paragraph (1) shall be applied by substituting— 26 USC 250. 26 USC 904 note. 26 USC 951 prec. VerDate Sep 11 2014 10:09 Oct 18, 2018 Jkt 079139 PO 00097 Frm 00161 Fmt 6580 Sfmt 6581 E:\PUBLAW\PUBL097.115 PUBL097 dkrause on DSKBC28HB2PROD with PUBLAWS