A QEF (Qualifying Electing Fund) election allows U.S. taxpayers to treat income from a Passive Foreign Investment Company (PFIC) as if it were from a domestic mutual fund, thus simplifying tax reporting and potentially reducing tax liability. This election requires annual reporting of the PFIC's income and gains, which are taxed at ordinary income rates, and it necessitates the taxpayer to have access to the PFIC's financial information.