Which of the following persons should not be treated as a "U.S. shareholder" of a controlled foreign corporation (CFC)for subpart F purposes?
A)A U.S. citizen owning 5 percent of the CFC.
B)A U.S. citizen owning 15 percent of the CFC.
C)A U.S. corporation owning 15 percent of the CFC.
D)All of the named persons are U.S. shareholders for subpart F purposes.

Question

Quizplus · Accepted Answer

A U.S. shareholder for subpart F purposes is defined as a U.S. person who owns 10 percent or more of the total combined voting power of all classes of stock entitled to vote of the foreign corporation. Therefore, a U.S. citizen owning 5 percent of the CFC does not meet this threshold and should not be treated as a "U.S. shareholder" of a CFC for subpart F purposes.

Which of the Following Persons Should Not Be Treated as a "U.S