BU466 Lecture 11: Chapter 12.5
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Associated group to identify the corporations that we are associated with. We might want to consider these when we do small business deduction allocation. How many corporations there are you want to allocate it them all but based on your own % If your answer is yes to any of the 5 paragraphs, then the corporations are associated. Only way you can say they aren"t associated is if you go through all 5 paragraphs and say no to all of them. Individuals can be related; corporations can be related and individuals to corporations can be related. Cross-ownership rule own 25% of the corporation. Control own more than 50 % Related related to the owner of another part. Investors are at the top and must flow downstream. Explaination: l owns 50% > of e so the have control. Therefore, l + e and must share sbd deduction limit, by virtue of section 256(1)(a): explanation: individual who owns two corporations.
