Practical Law Glossary Item 3-502-2929 (Approx. 2 pages)
Glossary
Substantial Owner
An individual who, at any time during the 60-month period ending on the date that the determination is made, satisfies one of three conditions:
Owns the entire interest in an unincorporated trade or business.
In the case of a partnership, is a partner who owns, directly or indirectly, more than 10% of either the capital interest or the profits interest in the partnership.
In the case of a corporation, owns, directly or indirectly, more than 10% in value of:
the voting stock of the corporation; or
all the stock of the corporation.
For purposes of determining ownership interests in a corporation, the constructive ownership rules of Code Section 1563(e) apply (other than the rules in paragraph 1563(e)(3)(C)), including the application of the rules under Code Section 414(c).