A Qualified Electing Fund (QEF) is a type of election that U.S. shareholders can make for their investment in a Passive Foreign Investment Company (PFIC) to be taxed on a current basis, avoiding the more punitive tax regime typically applied to PFICs. By making a QEF election, shareholders report their share of the PFIC's income and gains annually, thus simplifying tax compliance and potentially reducing their tax liability.