Definition of a CFC: When it comes to a CFC, the most important concept is knowing if you have one. And, to know if you have invested in a CFC would mean you understand what a CFC is:
The general rule is found in 26. U.S.C. section 957:
For purposes of this title, the term “controlled foreign corporation” means any foreign corporation if more than 50 percent of—
(1) the total combined voting power of all classes of stock of such corporation entitled to vote, or
(2) the total value of the stock of such corporation, is owned (within the meaning of section 958(a)), or is considered as owned by applying the rules of ownership of section 958(b), by United States shareholders on any day during the taxable year of such foreign corporation.
Additional CFC Resources
We have additional detailed information Controlled Foreign Corporations for your reference.