# 26 U.S.C. § 951: Amounts included in gross income of United States shareholders Source: OLRC release point 119-134 . Cite pinpoints as 26 U.S.C. § 951(a)(1). ## § 951(a) Amounts included **§ 951(a)(1) In general.** If a foreign corporation is a controlled foreign corporation at any time during a taxable year of the foreign corporation (in this subsection referred to as the “CFC year”)— **§ 951(a)(1)(A)** each United States shareholder which owns (within the meaning of section 958(a)) stock in such corporation on any day during the CFC year shall include in gross income such shareholder’s pro rata share (determined under paragraph (2)) of the corporation’s subpart F income for the CFC year, and **§ 951(a)(1)(B)** each United States shareholder which owns (within the meaning of section 958(a)) stock in such corporation on the last day, in the CFC year, on which such corporation is a controlled foreign corporation shall include in gross income the amount determined under section 956 with respect to such shareholder for the CFC year (but only to the extent not excluded from gross income under section 959(a)(2)). **§ 951(a)(2) Pro rata share of subpart F income.** A United States shareholder’s pro rata share of a controlled foreign corporation’s subpart F income for a CFC year shall be the portion of such income which is attributable to— **§ 951(a)(2)(A)** the stock of such corporation owned (within the meaning of section 958(a)) by such shareholder, and **§ 951(a)(2)(B)** any period of the CFC year during which— **§ 951(a)(2)(B)(i)** such shareholder owned (within the meaning of section 958(a)) such stock, **§ 951(a)(2)(B)(ii)** such shareholder was a United States shareholder of such corporation, and **§ 951(a)(2)(B)(iii)** such corporation was a controlled foreign corporation. **§ 951(a)(3) Taxable year of inclusion.** Any amount required to be included in gross income by a United States shareholder under paragraph (1) with respect to a CFC year shall be included in gross income for the shareholder’s taxable year which includes the last day on which the shareholder owns (within the meaning of section 958(a)) stock in the controlled foreign corporation during such CFC year. **§ 951(a)(4) Regulatory authority.** The Secretary shall prescribe such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this subsection, including regulations or other guidance allowing taxpayers to elect, or requiring taxpayers, to close the taxable year of a controlled foreign corporation upon a direct or indirect disposition of stock of such corporation. ## § 951(b) United States shareholder defined For purposes of this title, the term “United States shareholder” means, with respect to any foreign corporation, a United States person (as defined in section 957(c)) who owns (within the meaning of section 958(a)), or is considered as owning by applying the rules of ownership of section 958(b), 10 percent or more of the total combined voting power of all classes of stock entitled to vote of such foreign corporation, or 10 percent or more of the total value of shares of all classes of stock of such foreign corporation. ## § 951(c) Coordination with passive foreign investment company provisions If, but for this subsection, an amount would be included in the gross income of a United States shareholder for any taxable year both under subsection (a)(1)(A)(i) and under section 1293 (relating to current taxation of income from certain passive foreign investment companies), such amount shall be included in the gross income of such shareholder only under subsection (a)(1)(A). ## Regulations - [Treas. Reg. § 1.951-1](/26/reg/1.951-1.md): Amounts included in gross income of United States shareholders. (interprets § 951) - [Treas. Reg. § 1.951-3](/26/reg/1.951-3.md): Coordination of subpart F with foreign personal holding company provisions. (interprets § 951) ## Final rules - [87 FR 3648](https://www.federalregister.gov/documents/2022/01/25/2022-00066/guidance-under-section-958-on-determining-stock-ownership) (2022): Guidance Under Section 958 on Determining Stock Ownership - [84 FR 53052](https://www.federalregister.gov/documents/2019/10/04/C2-2019-12437/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 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 - [71 FR 8943](https://www.federalregister.gov/documents/2006/02/22/06-1532/special-rules-regarding-certain-section-951-pro-rata-share-allocations) (2006): Special Rules Regarding Certain Section 951 Pro Rata Share Allocations - [70 FR 49864](https://www.federalregister.gov/documents/2005/08/25/05-16611/guidance-under-section-951-for-determining-pro-rata-share) (2005): Guidance Under Section 951 for Determining Pro Rata Share ## Leading cases - [Dougherty v. Commissioner, 60 T.C. 917 (1973)](https://www.courtlistener.com/opinion/4703741/dougherty-v-commissioner/) ## Proposed regulations (not in force) - [Prop. Treas. Reg. § 1.951-2](/26/prop/1.951-2_2024-27227.md): Foreign corporation-level assignment rules for covered items. (REG-105479-18, proposed 2024-12-02) - [Prop. Treas. Reg. § 1.951-1](/26/prop/1.951-1_2026-17365.md): Amounts included in gross income of United States shareholders. (REG-115646-25, proposed 2026-08-26) - [Prop. Treas. Reg. § 1.951-4](/26/prop/1.951-4_2026-17365.md): Transition rule for dividends. (REG-115646-25, proposed 2026-08-26) ## Connections Cites: § 956 Investment of earnings in United States property; § 957 Controlled foreign corporations; United States persons; § 958 Rules for determining stock ownership; § 959 Exclusion from gross income of previously taxed earnings and profits; § 1293 Current taxation of income from qualified electing funds Cited by: § 56A Adjusted financial statement income; § 168 Accelerated cost recovery system; § 245A Deduction for foreign source-portion of dividends received by domestic corporations from specified 10-percent owned foreign corporations; § 250 Foreign-derived deduction eligible income and net CFC tested income; § 267A Certain related party amounts paid or accrued in hybrid transactions or with hybrid entities; § 304 Redemption through use of related corporations; § 512 Unrelated business taxable income; § 535 Accumulated taxable income; § 543 Personal holding company income; § 851 Definition of regulated investment company; § 864 Definitions and special rules; § 877 Expatriation to avoid tax; § 898 Taxable year of certain foreign corporations; § 904 Limitation on credit; § 951A Net CFC tested income included in gross income of United States shareholders; § 951B Amounts included in gross income of foreign controlled United States shareholders; § 952 Subpart F income defined; § 953 Insurance income; § 956 Investment of earnings in United States property; § 958 Rules for determining stock ownership; § 959 Exclusion from gross income of previously taxed earnings and profits; § 960 Deemed paid credit for subpart F inclusions; § 961 Adjustments to basis of stock in controlled foreign corporations and of other property; § 962 Election by individuals to be subject to tax at corporate rates; § 964 Miscellaneous provisions; § 965 Treatment of deferred foreign income upon transition to participation exemption system of taxation; § 989 Other definitions and special rules; § 993 Definitions and special rules; § 996 Rules for allocation in the case of distributions and losses; § 999 Reports by taxpayers; determinations; § 1248 Gain from certain sales or exchanges of stock in certain foreign corporations; § 1293 Current taxation of income from qualified electing funds; § 1294 Election to extend time for payment of tax on undistributed earnings; § 1297 Passive foreign investment company; § 1298 Special rules; § 6241 Definitions and special rules; § 6501 Limitations on assessment and collection; § 6654 Failure by individual to pay estimated income tax; § 6655 Failure by corporation to pay estimated income tax ## Amendments - 1962-10-16: [Pub. L. 87-834](/26/act/87-834.md), 76 Stat. 1006 - 1975-03-29: [Pub. L. 94-12](/26/act/94-12.md), 89 Stat. 58 - 1976-10-04: [Pub. L. 94-455](/26/act/94-455.md), 90 Stat. 1784 - 1984-07-18: [Pub. L. 98-369](/26/act/98-369.md), 98 Stat. 666 - 1986-10-22: [Pub. L. 99-514](/26/act/99-514.md), 100 Stat. 2574 - 1988-11-10: [Pub. L. 100-647](/26/act/100-647.md), 102 Stat. 3510 - 1993-08-10: [Pub. L. 103-66](/26/act/103-66.md), 107 Stat. 495 - 1996-08-20: [Pub. L. 104-188](/26/act/104-188.md), 110 Stat. 1825 - 1997-08-05: [Pub. L. 105-34](/26/act/105-34.md), 111 Stat. 969 - 2004-10-22: [Pub. L. 108-357](/26/act/108-357.md), 118 Stat. 1508 - 2007-12-29: [Pub. L. 110-172](/26/act/110-172.md), 121 Stat. 2490 - 2017-12-22: [Pub. L. 115-97](/26/act/115-97.md), 131 Stat. 2192 - 2025-07-04: [Pub. L. 119-21](/26/act/119-21.md), 139 Stat. 210