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136 STAT. 1824 PUBLIC LAW 117–169—AUG. 16, 2022 ‘‘(i) no adjustment shall be made under this para- graph for such taxable year, and ‘‘(ii) the amount of the adjustment determined under this paragraph for the succeeding taxable year (determined without regard to this paragraph) shall be reduced by an amount equal to the negative adjust- ment for such taxable year. ‘‘(4) EFFECTIVELY CONNECTED INCOME.—In the case of a foreign corporation, to determine adjusted financial statement income, the principles of section 882 shall apply. ‘‘(5) ADJUSTMENTS FOR CERTAIN TAXES.—Adjusted financial statement income shall be appropriately adjusted to disregard any Federal income taxes, or income, war profits, or excess profits taxes (within the meaning of section 901) with respect to a foreign country or possession of the United States, which are taken into account on the taxpayer’s applicable financial statement. To the extent provided by the Secretary, the pre- ceding sentence shall not apply to income, war profits, or excess profits taxes (within the meaning of section 901) that are imposed by a foreign country or possession of the United States and taken into account on the taxpayer’s applicable financial statement if the taxpayer does not choose to have the benefits of subpart A of part III of subchapter N for the taxable year. The Secretary shall prescribe such regulations or other guid- ance as may be necessary and appropriate to provide for the proper treatment of current and deferred taxes for purposes of this paragraph, including the time at which such taxes are properly taken into account. ‘‘(6) ADJUSTMENT WITH RESPECT TO DISREGARDED ENTI- TIES.—Adjusted financial statement income shall be adjusted to take into account any adjusted financial statement income of a disregarded entity owned by the taxpayer. ‘‘(7) SPECIAL RULE FOR COOPERATIVES.—In the case of a cooperative to which section 1381 applies, the adjusted financial statement income (determined without regard to this para- graph) shall be reduced by the amounts referred to in section 1382(b) (relating to patronage dividends and per-unit retain allocations) to the extent such amounts were not otherwise taken into account in determining adjusted financial statement income. ‘‘(8) RULES FOR ALASKA NATIVE CORPORATIONS.—Adjusted financial statement income shall be appropriately adjusted to allow— ‘‘(A) cost recovery and depletion attributable to prop- erty the basis of which is determined under section 21(c) of the Alaska Native Claims Settlement Act (43 U.S.C. 1620(c)), and ‘‘(B) deductions for amounts payable made pursuant to section 7(i) or section 7(j) of such Act (43 U.S.C. 1606(i) and 1606(j)) only at such time as the deductions are allowed for tax purposes. ‘‘(9) AMOUNTS ATTRIBUTABLE TO ELECTIONS FOR DIRECT PAY- MENT OF CERTAIN CREDITS.—Adjusted financial statement income shall be appropriately adjusted to disregard any amount treated as a payment against the tax imposed by subtitle A pursuant to an election under section 48D(d) or 6417, to the Applicability. Regulations. Guidelines. Determination. Applicability. VerDate Sep 11 2014 13:57 Oct 25, 2022 Jkt 029139 PO 00169 Frm 00008 Fmt 6580 Sfmt 6581 E:\PUBLAW\PUBL169.117 PUBL169 jmbennett on LAP3P8D0R2PROD with Publaw