M owns 60 percent of B Corporation and 40 percent of C Corporation.C Corporation owns 20 percent of B Corporation.Under the constructive ownership rules of § 318, M is treated as owning 60 percent of B.

Question

Quizplus · Accepted Answer

According to the constructive ownership rules of § 318, M is treated as owning the percentage of shares owned by C Corporation (40% of B) in addition to their own percentage of shares (60% of B). Therefore, M is treated as owning 100% of B, which is more than 50%, and thus controls the corporation.

M Owns 60 Percent of B Corporation and 40 Percent