### Question
How is the "post-1986 undistributed earnings" defined?


### Answer
The term **post-1986 undistributed earnings** is defined in *26 U.S.C. § 902* as follows -

> the amount of the earnings and profits of the foreign corporation (computed in accordance with sections 964(a) and 986) accumulated in taxable years beginning after December 31, 1986—


(A) as of the close of the taxable year of the foreign corporation in which the dividend is distributed, and


(B) without diminution by reason of dividends distributed during such taxable year

#### Citation:
  - *26 U.S.C. § 902*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter N-Tax Based on Income From Sources Within or Without the United States > PART III-INCOME FROM SOURCES WITHOUT THE UNITED STATES > Subpart A-Foreign Tax Credit**

