(1) |
An enterprise that directly or indirectly, through one or more intermediaries, controls, or is controlled by, or is under common control with, the reporting enterprise. |
(2) |
An individual who directly, or indirectly through one or more intermediaries, controls the reporting enterprise. |
(3) |
An individual having an ownership interest in the reporting enterprise that results in significant influence or joint control. |
(4) |
Members of the immediate family of individuals described in above three point. |
(1) |
Direct acquisition In the context of debt acquisition, a direct acquisition occurs when an individual who is related with the debtor or was related with the debtor at the time of acquisition, obtains the liability from an individual who is not related with the debtor. |
(2) |
Indirect acquisition An indirect acquisition is a transaction in which a holder of outstanding indebtedness becomes related to the debtor if the holder acquired the indebtedness in anticipation of becoming related to the debtor. |
(3) |
In the assessment of whether a creditor obtained debt with the expectation of establishing a relationship with the debtor, all pertinent factors and conditions will be considered. (a) The intent of the parties at the time of the acquisition, the nature of any contacts between the parties (or their respective affiliates) before the acquisition. (b) The duration during which the debtor possessed the financial obligation. (c) Debt as a percentage of the holder group's total assets. |
(1) |
Indebtedness acquired within six months of becoming related In the context of indebtedness, it is deemed that a holder of such indebtedness has obtained it with the expectation of establishing a relationship with the debtor if the acquisition occurred within a period of less than six months prior to the date on which the holder becomes related to the debtor. If indebtedness represents more than 25% of the fair market value of holder group’s assets on the date the holder becomes related to the debtor, the debtor must attach a statement with its tax return or qualified amended return for the taxable year in which the debtor becomes related to the holder. However, this requirement does not apply if the debtor reports its income based on the assumption that the indebtedness was acquired by the holder in anticipation of becoming related to the debtor. The assets of the holder group do not encompass cash, cash equivalents, marketable stocks or securities, short-term debts, options, futures contracts, notional principal contracts, or similar items (excluding the debtor's indebtedness). Furthermore, the total gross assets do not incorporate any asset in which the holder has significantly mitigated the risk of loss. Additionally, any ownership interest or indebtedness of a member within the holder group is not considered part of the total gross assets. |
(2) |
Indebtedness acquired within 6 to 24 months of becoming related. If a debtor neglects to furnish a necessary statement, it is assumed that the holder obtained the indebtedness with the expectation of establishing a relationship with the debtor, unless the facts and circumstances clearly demonstrate that the holder did not acquire the indebtedness with the intention of becoming related to the debtor. |
(1) |
A caption identifying the statement as disclosure under Treasury Regulations § 1.108-2(c). |
(2) |
Identification of the indebtedness for which disclosure is provided. |
(3) |
The amount of such indebtedness and the amount of income from discharge of indebtedness if section 108(e)(4) were to apply. |
(4) |
Whether indebtedness representing more than 25% of the fair market value of holder group’s assets on the date the holder becomes related to the debtor or indebtedness acquired within 6 to 24 months of becoming related apply to the transaction. |
(5) |
An assertion outlining the factual details and contextual factors that substantiate the debtor's claim that the holder did not obtain the debt with the expectation of establishing a relationship with the debtor. |
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