26 U.S.C. § 1372

Current through P.L. 118-3 (published on www.congress.gov on 04/10/2023), except for [P. L. 117-328]
Section 1372 - Partnership rules to apply for fringe benefit purposes
(a) General rule

For purposes of applying the provisions of this subtitle which relate to employee fringe benefits-

(1) the S corporation shall be treated as a partnership, and
(2) any 2-percent shareholder of the S corporation shall be treated as a partner of such partnership.
(b) 2-percent shareholder defined

For purposes of this section, the term "2-percent shareholder" means any person who owns (or is considered as owning within the meaning of section 318) on any day during the taxable year of the S corporation more than 2 percent of the outstanding stock of such corporation or stock possessing more than 2 percent of the total combined voting power of all stock of such corporation.

26 U.S.C. § 1372

Added Pub. L. 97-354, §2, Oct. 19, 1982, 96 Stat. 1682.


PRIOR PROVISIONSA prior section 1372, added Pub. L. 85-866, title I, §64(a), Sept. 2, 1958, 72 Stat. 1650; amended Pub. L. 87-29, §2, May 4, 1961, 75 Stat. 64; Pub. L. 89-389, §§2(b)(2), 3(a), Apr. 14, 1966, 80 Stat. 114; Pub. L. 91-683, §1(a), Jan. 12, 1971, 84 Stat. 2067; Pub. L. 94-455, title IX, §902(c)(3), title XIX, §§1901(a)(149), 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1609, 1788, 1834; Pub. L. 95-600, title III, §343, Nov. 6, 1978, 92 Stat. 2843; Pub. L. 95-628, §5(a), (b), Nov. 10, 1978, 92 Stat. 3628, related to manner, effect, termination, etc., of an election not to be subject to taxes imposed under this chapter, prior to the general revision of this subchapter by section 2 of Pub. L. 97-354.


EFFECTIVE DATESection applicable to taxable years beginning after Dec. 31, 1982, except that in the case of a taxable year beginning during 1982, sections 1362(d)(3), 1366(f)(3),and 1375 of this title shall apply and subsec. (e)(5) of this section as in effect on the day before Oct. 19, 1982, shall not apply, see section 6(a), (b)(3), of Pub. L. 97-354 set out as a note under section 1361 of this title. For additional provisions relating to the treatment of existing fringe benefit plans and the application of this section, see section 6(d) of Pub. L. 97-354 set out as a note under section 1361 of this title.

The term "corporation" includes associations, joint-stock companies, and insurance companies.
The term "person" shall be construed to mean and include an individual, a trust, estate, partnership, association, company or corporation.
The term "shareholder" includes a member in an association, joint-stock company, or insurance company.
The term "stock" includes shares in an association, joint-stock company, or insurance company.
taxable year
The term "taxable year" means the calendar year, or the fiscal year ending during such calendar year, upon the basis of which the taxable income is computed under subtitle A. "Taxable year" means, in the case of a return made for a fractional part of a year under the provisions of subtitle A or under regulations prescribed by the Secretary, the period for which such return is made.