983 / Are there any tax credits available for PFIC shareholders?

There are separate foreign tax credit rules for PFICs. Generally, non-corporate PFIC shareholders may not take advantage of foreign tax credits.¹

However, a corporate shareholder that owns 10 percent of the PFIC’s voting stock is entitled to a “deemed paid” foreign tax credit. The shareholder must allocate the foreign taxes between excess distributions (which is treated as foreign sourced income) and non-excess distribution amounts, and between pre-PFIC and PFIC years. The credit must then be applied to those various amounts.²