26 U.S.C. § 1355
Definitions and special rules
The term “electing corporation” means any corporation for which an election is in effect under this subchapter.
The term “electing group” means a controlled group of which one or more members is an electing corporation.
The term “controlled group” means any group which would be treated as a single employer under subsection (a) or (b) of section 52 if paragraphs (1) and (2) of section 52(a) did not apply.
The term “qualifying vessel” means a self-propelled (or a combination self-propelled and non-self-propelled) United States flag vessel of not less than 6,000 deadweight tons used exclusively in the United States foreign trade during the period that the election under this subchapter is in effect.
The term “United States flag vessel” means any vessel documented under the laws of the United States.
The term “United States domestic trade” means the transportation of goods or passengers between places in the United States.
The term “United States foreign trade” means the transportation of goods or passengers between a place in the United States and a foreign place or between foreign places.
Except as otherwise provided in this subsection, a corporation meets the shipping activity requirement of this subsection for any taxable year only if the requirement of paragraph (4) is met for each of the 2 preceding taxable years.
A corporation meets the shipping activity requirement of this subsection for the first taxable year for which the election under section 1354(a) is in effect only if the requirement of paragraph (4) is met for the preceding taxable year.
A corporation who is a member of a controlled group meets the shipping activity requirement of this subsection only if such requirement is met determined by treating all members of such group as 1 person.
The requirement of this paragraph is met for any taxable year if, on average during such year, at least 25 percent of the aggregate tonnage of qualifying vessels used by the corporation were owned by such corporation or chartered to such corporation on bareboat charter terms.
Notice shall be deemed timely if given not later than the due date (including extensions) for the corporation’s tax return for the taxable year in which the temporary cessation begins.
Notice shall be deemed timely if given not later than the due date (including extensions) for the corporation’s tax return for the taxable year in which the temporary cessation begins.
Paragraph (1) shall not apply to any qualifying vessel which is operated in the United States domestic trade for more than 30 days during the taxable year.
Notice shall be deemed timely if given not later than the due date (including extensions) for the corporation’s tax return for the taxable year in which the temporary cessation begins.
Subparagraph (A) shall not apply to any qualifying vessel which is operated in the United States domestic trade (other than qualified zone domestic trade) for more than 30 days during the taxable year.
In the case of a qualifying vessel to which this subsection applies, the Secretary shall prescribe rules for the proper allocation of income, expenses, losses, and deductions between the qualified shipping activities and the other activities of such vessel.
The term “qualified zone domestic trade” means the transportation of goods or passengers between places in the qualified zone if such transportation is in the United States domestic trade.
The term “qualified zone” means the Great Lakes Waterway and the St. Lawrence Seaway.
The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section.
2018—Subsec. (f)(3). Pub. L. 115–141 substituted “on which” for “of which” in introductory provisions.
2006—Subsec. (a)(4). Pub. L. 109–432, § 413(a), substituted “6,000” for “10,000 (6,000, in the case of taxable years beginning after
Pub. L. 109–222 inserted “(6,000, in the case of taxable years beginning after
Subsecs. (g), (h). Pub. L. 109–432, § 415(a), added subsec. (g) and redesignated former subsec. (g) as (h).
2005—Subsec. (a)(8). Pub. L. 109–135, § 403(g)(1)(B), struck out heading and text of par. (8). Text read as follows: “The term ‘charter’ includes an operating agreement.”
Subsec. (b)(1). Pub. L. 109–135, § 403(g)(1)(C), reenacted heading without change and amended text generally. Prior to amendment, text read as follows: “Except as provided in paragraph (2), a person is treated as operating any vessel during any period if such vessel is—
“(A) owned by, or chartered (including a time charter) to, the person, and
“(B) is in use as a qualifying vessel during such period.”
Subsec. (c)(3). Pub. L. 109–135, § 403(g)(2), substituted “determined by treating all members of such group as 1 person.” for “determined—
“(A) by treating all members of such group as 1 person, and
“(B) by disregarding vessel charters between members of such group.”
Subsec. (d)(3). Pub. L. 109–135, § 403(g)(1)(D), amended par. (3) generally. Prior to amendment, par. (3) read as follows: “the extent of a partner’s ownership or charter interest in any vessel owned by or chartered to the partnership shall be determined on the basis of the partner’s interest in the partnership.”
Pub. L. 109–432, div. A, title IV, § 413(b),
Pub. L. 109–432, div. A, title IV, § 415(b),
Pub. L. 109–222, title II, § 205(b),
Amendments by Pub. L. 109–135 effective as if included in the provisions of the American Jobs Creation Act of 2004, Pub. L. 108–357, to which they relate, see section 403(nn) of Pub. L. 109–135, set out as a note under section 26 of this title.
Section applicable to taxable years beginning after