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136 STAT. 1820 PUBLIC LAW 117–169—AUG. 16, 2022 statement income of such corporation, and adjusted financial statement income of such corporation shall be determined without regard to paragraphs (2)(D)(i) and (11) of section 56A(c). ‘‘(ii) MODIFICATIONS.—For purposes of this subparagraph— ‘‘(I) section 52(a) shall be applied by sub- stituting ‘component members’ for ‘members’, and ‘‘(II) for purposes of applying section 52(b), the term ‘trade or business’ shall include any activity treated as a trade or business under para- graph (5) or (6) of section 469(c) (determined with- out regard to the phrase ‘To the extent provided in regulations’ in such paragraph (6)). ‘‘(iii) COMPONENT MEMBER.—For purposes of this subparagraph, the term ‘component member’ has the meaning given such term by section 1563(b), except that the determination shall be made without regard to section 1563(b)(2). ‘‘(E) OTHER SPECIAL RULES.— ‘‘(i) CORPORATIONS IN EXISTENCE FOR LESS THAN 3 YEARS.—If the corporation was in existence for less than 3-taxable years, subparagraph (B) shall be applied on the basis of the period during which such corpora- tion was in existence. ‘‘(ii) SHORT TAXABLE YEARS.—Adjusted financial statement income for any taxable year of less than 12 months shall be annualized by multiplying the adjusted financial statement income for the short period by 12 and dividing the result by the number of months in the short period. ‘‘(iii) TREATMENT OF PREDECESSORS.—Any ref- erence in this subparagraph to a corporation shall include a reference to any predecessor of such corpora- tion. ‘‘(2) SPECIAL RULE FOR FOREIGN-PARENTED MULTINATIONAL GROUPS.— ‘‘(A) IN GENERAL.—If a corporation is a member of a foreign-parented multinational group for any taxable year, then, solely for purposes of determining whether such corporation meets the average annual adjusted financial statement income test under paragraph (1)(B)(ii)(I) for such taxable year, the adjusted financial statement income of such corporation for such taxable year shall include the adjusted financial statement income of all members of such group. Solely for purposes of this subparagraph, adjusted financial statement income shall be determined without regard to paragraphs (2)(D)(i), (3), (4), and (11) of section 56A(c). ‘‘(B) FOREIGN-PARENTED MULTINATIONAL GROUP.—For purposes of subparagraph (A), the term ‘foreign-parented multinational group’ means, with respect to any taxable year, two or more entities if— ‘‘(i) at least one entity is a domestic corporation and another entity is a foreign corporation, Definition. Time period. Applicability. Applicability. VerDate Sep 11 2014 13:57 Oct 25, 2022 Jkt 029139 PO 00169 Frm 00004 Fmt 6580 Sfmt 6581 E:\PUBLAW\PUBL169.117 PUBL169 jmbennett on LAP3P8D0R2PROD with Publaw