Other modifications relating to foreign tax credit

(a) Creditable taxes Section 901 is amended by redesignating subsection (n) as subsection (o) and by inserting after subsection (m) the following new subsection: (n) Determination of income taxes For purposes of this section, a foreign tax shall be treated as an income tax if the predominant character of the tax is an income tax. The determinations made under the preceding sentence and under section 903 shall be made without regard to whether the income or other base of the tax bears a nexus to the jurisdiction imposing the tax.. (b) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2025.