Together, Kurt and Esmeralda own 60% of three corporations: RAZ, DVA, and TRE.The three corporations would be considered as what kind of controlled group for tax purposes?
A) Combined.
B) Parent-subsidiary.
C) Brother-sister.
D) The three corporations would not be considered to be a controlled group for tax purposes.

Question

Quizplus · Accepted Answer

The given scenario involves three corporations, RAZ, DVA, and TRE, that are not directly related to each other as subsidiaries or parent companies. Therefore, they cannot be classified as a parent-subsidiary controlled group. Also, since there is no clear indication of any common ownership or control in terms of stock or management, they cannot be considered a combined group either. The only remaining option is that they are classified as a brother-sister controlled group since they are owned jointly by two individuals, Kurt and Esmeralda. Therefore, the correct answer is option C.

Together, Kurt and Esmeralda Own 60% of Three Corporations: RAZ