Negotiating an economic transaction

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Indicate whether or not the parties in the following situations are "related" for tax purposes. (Consider the unrelated examples to be operating at arm's length.)

A) An uncle and their nephew are negotiating an economic transaction. Are the uncle and nephew related for tax purposes?

B) An individual is the sole shareholder of Corporation X, and the individual's spouse is the sole shareholder of Corporation Y. Are the two corporations related for tax purposes?

C) An individual owns seventy percent of the shares of ABC Co. Another individual owns the remaining thirty percent. The two individuals are not related. Is the 30% shareholder related to ABC Co.?

D) An individual owns thirty percent of the shares of Corporation A. The individual's spouse also owns thirty percent of the shares of Corporation A. The remaining forty percent is owned by a friend of the family. Is the first individual related to Corporation A for tax purposes?

E) Individual A and their sibling's spouse are negotiating an economic transaction. Are Individual A and the sibling's spouse related for tax purposes?

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Reference no: EM132731515

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