Sec. 1.954-0 Introduction.
(a) Effective dates.
(1) Final regulations.
(i) In general. Except as otherwise specifically provided, the provisions of sections 1.954-1 and 1.954-2 apply to taxable years of a controlled foreign corporation beginning after November 6, 1995. If any of the rules described in sections 1.954-1 and 1.954-2 are inconsistent with provisions of other regulations under subpart F, these final regulations are intended to apply instead of such other regulations.
(ii) Election to apply final regulations retroactively.
(A) Scope of election. An election may be made to apply the final regulations retroactively with respect to any taxable year of the controlled foreign corporation beginning on or after January 1, 1987. If such an election is made, these final regulations must be applied in their entirety for such taxable year and all subsequent taxable years. All references to section 11 in the final regulations shall be deemed to include section 15, where applicable.
(B) Manner of making election. An election under this paragraph (a)(1)(ii) is binding on all United States shareholders of the controlled foreign corporation and must be made--
(1) By the controlling United States shareholders, as defined in section 1.964-1(c)(5), by attaching a statement to such effect with their original or amended income tax returns for the taxable year of such United States shareholders in which or with which the taxable year of the CFC ends, and including any additional information required by applicable administrative pronouncements, or
(2) In such other manner as may be prescribed in applicable administrative pronouncements.
(C) Time for making election. An election may be made under this paragraph (a)(1)(ii) with respect to a taxable year of the controlled foreign corporation beginning on or after January 1, 1987 only if the time for filing a return or claim for refund has not expired for the taxable year of any United States shareholder of the controlled foreign corporation in which or with which such taxable year of the controlled foreign corporation ends.
(D) Revocation of election. An election made under this paragraph (a)(1)(ii) may not be revoked.
(2) Temporary regulations. The provisions of sections 4.954-1 and 4.954-2 of this chapter apply to taxable years of a controlled foreign corporation beginning after December 31, 1986 and on or before November 6, 1995. However, the provisions of section 4.954-2(b)(6) of this chapter continue to apply. For transactions entered into on or before October 9, 1995, taxpayers may rely on Notice 89-90, 1989-2 C.B. 407, in applying the temporary regulations.
(3) Sections 1.954A-1 and 1.954A-2. The provisions of sections 1.954A-1 and 1.954A-2 (as contained in 26 CFR part 1 edition revised April 1, 1995) apply to taxable years of a controlled foreign corporation beginning before January 1, 1987. All references therein to sections of the Code are to the Internal Revenue Code of 1954 prior to the amendments made by the Tax Reform Act of 1986.
(b) [Reserved]
[T.D. 8618, 60 FR 46500-46530, Sept. 7, 1995; corrected at 60 FR 62024-62026, Dec. 4, 1995, as amended by T.D. 8767, 63 FR 14613-14620, Mar. 26, 1998; T.D. 9039, 68 FR 4916-4918, Jan. 31, 2003; T.D. 9883, 84 FR 63802-63804, Nov. 19, 2019; T.D. 9902, 85 FR 44620-44649, July 23, 2020.]
