QEF (Qualified Electing Fund) election

A PFIC election that taxes you currently on your pro-rata share of the fund's earnings — avoiding the §1291 regime.

Also called QEF, QEF election, §1295 election.

Under a Qualified Electing Fund election you include your share of the PFIC's ordinary earnings and net capital gain currently, regardless of distribution. The trade-off is fund-cooperation: the issuer must provide a PFIC Annual Information Statement (PFIC AIS) with per-share ordinary earnings and net capital gain. Most retail-distributed foreign mutual funds do not issue an AIS, which is why MtM is the common election for publicly-traded PFICs and §1291 remains the default for the rest.

This glossary entry is general reference, not advice for your specific return. Start your filing on the residency step.