Passive Foreign Investment Company

(redirected from PFIC)
Also found in: Acronyms.

Passive Foreign Investment Company

A company based in a foreign country where either at least 75% of its income comes from passive sources, such as rent or dividend, or at least 50% of its assets carry dividends or interest. PFICs are subject to strict tax guidelines in the United States that intend to discourage investment by Americans. See also: Income test, Asset test.
References in periodicals archive ?
The default regime under section 1291 imposes an interest charge on any "excess distributions" (regardless of whether the PFIC has actual earnings and profits) from the PFIC.
foreign tax credits can help shelter Subpart F income and PFIC income.
A PFIC shareholder required to report information under See.
Under the PFIC rules, the shareholder owes this extra tax because of the deferral of income.
owners, however, avoidance of the PFIC rules has come via an election under Internal Revenue Code Section 953 (d)-to have the company treated as a domestic company-or via Internal Revenue Code Section 1296 (b)(2)(B), which provides that income earned in connection with the active conduct of an insurance business will not be considered as passive income for purposes of the PFIC rules.
To access Aircastle's 2014 PFIC Annual Information Statement, select the tab "Tax Information (PFIC)" under the Investors section of the home page of the Aircastle website at www.
LUM001 may reproduce the effects of more invasive surgical procedures for children suffering from PFIC," said Dr.
As evidenced by the legislative history of the PFIC provisions and the General Explanation of the Tax Reform Act of 1986 released by the Joint Committee on Taxation (JCS-10-87 at p.
The suspension of the Form 8621 filing requirement applies only to PFIC shareholders that are not otherwise required to file Form 8621 under the current Form 8621 instructions.
Often, the PFIC trap can be avoided from the outset by electing one of two alternative methods to tax shareholders who own PFIC stock.
PFIC rules, there are a number of significant differences in the approach taken by the two countries.