; determination of section 960 credit on current year basis (a) Repeal of section 902 indirect foreign tax credits Subpart A of part III of subchapter N of chapter 1 is amended by striking section 902. (b) Determination of section 960 credit on current year basis Section 960 is amended— (1) by striking subsection (c), by redesignating subsection (b) as subsection (c), by striking all that precedes subsection (c) (as so redesignated) and inserting the following: 960. Deemed paid credit for subpart F inclusions (a) In general For purposes of this subpart, if there is included in the gross income of a domestic corporation any item of income under section 951(a)(1) with respect to any controlled foreign corporation with respect to which such domestic corporation is a United States shareholder, such domestic corporation shall be deemed to have paid so much of such foreign corporation’s foreign income taxes as are properly attributable to the item of income so included. (b) Special rules for distributions from previously taxed earnings and profits For purposes of this subpart— (1) In general If any portion of a distribution from a controlled foreign corporation to a domestic corporation which is a United States shareholder with respect to such controlled foreign corporation is excluded from gross income under section 959(a), such domestic corporation shall be deemed to have paid so much of such foreign corporation’s foreign income taxes as— (A) are properly attributable to such portion, and (B) have not been deemed to have to been paid by such domestic corporation under this section for any prior taxable year. (2) Tiered controlled foreign corporations If section 959(b) applies to any portion of a distribution from a controlled foreign corporation to another controlled foreign corporation, such controlled foreign corporation shall be deemed to have paid so much of such other controlled foreign corporation’s foreign income taxes as— (A) are properly attributable to such portion, and (B) have not been deemed to have been