26 USC 533: Evidence of purpose to avoid income tax
Text contains those laws in effect on April 25, 2024
From Title 26-INTERNAL REVENUE CODESubtitle A-Income TaxesCHAPTER 1-NORMAL TAXES AND SURTAXESSubchapter G-Corporations Used to Avoid Income Tax on ShareholdersPART I-CORPORATIONS IMPROPERLY ACCUMULATING SURPLUS
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§533. Evidence of purpose to avoid income tax
(a) Unreasonable accumulation determinative of purpose
For purposes of section 532, the fact that the earnings and profits of a corporation are permitted to accumulate beyond the reasonable needs of the business shall be determinative of the purpose to avoid the income tax with respect to shareholders, unless the corporation by the preponderance of the evidence shall prove to the contrary.
(b) Holding or investment company
The fact that any corporation is a mere holding or investment company shall be prima facie evidence of the purpose to avoid the income tax with respect to shareholders.