86
PUBLIC LAW 88-272-FEB. 26, 1964
[78 STAT.
This paragraph shall apply with respect to amounts received for services under a particular contract only if at some time during the taxable year 25 percent or more in value of the outstanding stock of the corporation is owned, directly or indirectly, by or for the individual who has performed, is to perform, or may be designated (by name or by description) as the one to perform, such services. " (6) U S E OF CORPORATION PROPERTY BY SHAREHOLDER.—Amounts
received as compensation (however designated and from whomsoever received) for the use of, or right to use, property of the corporation in any case where, at any time during the taxable year, 25 percent or more in value of the outstanding stock of the corporation is owned, directly or indirectly, by or for an individual entitled to the use of the property; whether such right is obtained directly from the corporation or by means of a sublease or other arrangement. This paragraph shall apply only to a corporation which has foreign personal holding company income for the taxable year, computed without regard to this paragraph and paragraph (7), in excess of 10 percent of its gross income, " (t) RENTS.—Rents, unless constituting 50 percent or more of the gross income. For purposes of this paragraph, the term 'rents' means compensation, however designated, for the use of, or ri^ht to use, property; but does not include amounts constituting foreign personal holding comj^any income under paragraph (6). " (b) LIMITATION ON GROSS INCOME I N CERTAIN TRANSACTIONS.—
68A^stay^95. Ante, p. 85.'
For purposes of this part— "(1) gross income and foreign personal holding company income determined with respect to transactions described in subsection (a)(2) (relating to gains from stock and security transactions) shall include only the excess of gains over losses from such transactions, and "(2) gross income and foreign personal holding company income determined with respect to transactions described in subsection (a)(3) (relating to gains from commodity transactions) shall include only the excess of gains over losses from such transactions. "vSEC. 554. STOCK OWNERSHIP. " (a) CONSTRUCTIVE OWNERSHIP.—For purposes of determining whether a corporation is a foreign personal holding company, insofar as such determination is based on stock ownership under section rM2(a)(2),section 553(a)(5), or section 553(a)(6) — " (1) S TO C K NOT OWNED BY INDIVIDUAL.
StOCk OWUed, dlTeCtly
or indirectly, by or for a corporation, partnership, estate, or trust shall be considered as beiii^ owned proportionately by its shareholders, partners, or beneficiaries. "(2) FAMILY AND PARTNERSHIP OWNERSHIP.—An individual shall be considered as owning the stock owned, directly o r indirectly, by or for his family or by or for his partner. For purposes of this paragraph, the family of an individual includes only his brothers and sisters (whether l\y the whole or half blood), spouse, ancestors, and lineal descendants. "(3) OPTIONS.—If any person has an option to acquire stock, such stock shall Im considered as owned by such person. For purposes of this paragraph, an option to acquire such an option, and each one of a series of such options, shall be considered as an option to acquire such stock.
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