§ 6-3-2-12 — Foreign source dividends; deduction; computation

(a) As used in this section, the term "foreign
source dividend" means a dividend from a foreign corporation. The
term:
(1) includes any amount that a taxpayer is required to include in
its gross income for a taxable year under Sections 951 and 951A
of the Internal Revenue Code, and, for taxable years beginning
after December 25, 2016, any amounts required to be included in
adjusted gross income under this article after application of IC 6-3-1-3.5(b)(13), IC 6-3-1-3.5(d)(12), and IC 6-3-1-3.5(e)(12),
but prior to application of this section; and
(2) does not include any amount that is treated as a dividend
under Section 78 of the Internal Revenue Code.
The reference in subdivision (1) to amounts required to be included in
adjusted gross income under this article after application of IC 6-3-1-3.5(b)(13), IC 6-3-1-3.5(d)(12), and IC 6-3-1-3.5(e)(12) applies
in the same taxable year that the taxpayer takes into account the
increase in Subpart F income as a result of Section 965(a) of the
Internal Revenue Code and uses the deduction for deferred foreign
income under Section 965(c) of the Internal Revenue Code.
(b) A corporation that includes any foreign source dividend in its
adjusted gross income for a taxable year is entitled to a deduction from
that adjusted gross income. The amount of the deduction equals the
product of:
(1) the amount of the foreign source dividend included in the
corporation's adjusted gross income for the taxable year;
multiplied by
(2) the percentage prescribed in subsection (c), (d), or (e), as the
case may be.
(c) The percentage referred to in subsection (b)(2) is one hundred
percent (100%) if the corporation that includes the foreign source
dividend in its adjusted gross income owns stock possessing at least
eighty percent (80%) of the total combined voting power of all classes
of stock of the foreign corporation from which the dividend is derived.
(d) The percentage referred to in subsection (b)(2) is eighty-five
percent (85%) if the corporation that includes the foreign source
dividend in its adjusted gross income owns stock possessing at least
fifty percent (50%) but less than eighty percent (80%) of the total
combined voting power of all classes of stock of the foreign
corporation from which the dividend is derived.
(e) The percentage referred to in subsection (b)(2) is fifty percent
(50%) if the corporation that includes the foreign source dividend in its
adjusted gross income owns stock possessing less than fifty percent
(50%) of the total combined voting power of all classes of stock of the
foreign corporation from which the dividend is derived.

Legislative History

As added by P.L.383-1987(ss), SEC.4. Amended by P.L.214-2018(ss), SEC.8.