- passive foreign investment company
Passive Foreign Investment Company (PFIC)USAA foreign corporation is a PFIC for any taxable year in which either at least:• 75% of its gross income is "passive income" (as defined in IRC § 1297(b)); or• 50%, on average and generally by value, of its assets (determined under IRC § 1297(f)) produce passive income or are held for the production of passive income.Passive income generally includes dividends, interest, royalties, rents (other than certain rents and royalties derived in the active conduct of a trade or business), annuities, and gains from the sale or exchange of assets that produce passive income.
Practical Law Dictionary. Glossary of UK, US and international legal terms. www.practicallaw.com. 2010.
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