# 26 U.S.C. § 78: Gross up for deemed paid foreign tax credit

Source: OLRC release point 119-134 <https://uscode.house.gov/us/usc/119-134/t26/s78>. Cite pinpoints as 26 U.S.C. § 78(a)(1).

If a domestic corporation chooses to have the benefits of subpart A of part III of subchapter N (relating to foreign tax credit) for any taxable year, an amount equal to the taxes deemed to be paid by such corporation under subsections (a) and (d) of section 960 (determined without regard to the phrase “90 percent of” in subsection (d)(1) thereof) for such taxable year shall be treated for purposes of this title (other than sections 245 and 245A) as a dividend received by such domestic corporation from the foreign corporation.

## Regulations

- [Treas. Reg. § 1.78-1](/26/reg/1.78-1.md): Gross up for deemed paid foreign tax credit. (interprets § 78)

## Final rules

- [84 FR 29288](https://www.federalregister.gov/documents/2019/06/21/2019-12437/guidance-related-to-section-951a-global-intangible-low-taxed-income-and-certain-guidance-related-to) (2019): Guidance Related to Section 951A (Global Intangible Low-Taxed Income) and Certain Guidance Related to Foreign Tax Credits
- [84 FR 9231](https://www.federalregister.gov/documents/2019/03/14/2019-03474/eliminating-unnecessary-tax-regulations) (2019): Eliminating Unnecessary Tax Regulations

## Leading cases

- [Champion Int'l Corp. v. Commissioner, 81 T.C. 424 (1983)](https://www.courtlistener.com/opinion/4705899/champion-intl-corp-v-commissioner/)

## Connections

Cites: § 960 Deemed paid credit for subpart F inclusions

Cited by: § 250 Foreign-derived deduction eligible income and net CFC tested income; § 904 Limitation on credit; § 908 Reduction of credit for participation in or cooperation with an international boycott; § 965 Treatment of deferred foreign income upon transition to participation exemption system of taxation; § 1291 Interest on tax deferral

## Amendments

- 1962-10-16: [Pub. L. 87-834](/26/act/87-834.md), 76 Stat. 1001
- 1976-10-04: [Pub. L. 94-455](/26/act/94-455.md), 90 Stat. 1628
- 2017-12-22: [Pub. L. 115-97](/26/act/115-97.md), 131 Stat. 2222
- 2025-07-04: [Pub. L. 119-21](/26/act/119-21.md), 139 Stat. 203