Question

How do the stock ownership requirements for an affiliated group of corporations differ from those for a controlled group? An affiliated group has a consolidated NOL for the current year. What factors could determine whether it would be advantageous or disadvantageous for the group to elect to forgo the carryback of the consolidated NOL?

Answer 1

Answer:

An “affiliated group” is a precise group that is entitled to organize a combined profit.  An affiliated group is in one or more chains of includable corporation linked over stock possession with a common parental, but only if:

Explanation:

• The common parental possesses straight at least 80% of the entire “vote and value” of the stock of at-least one includable corporation; and
• Stock representing 80% of the “vote and value” of each includable corporation is possessed straight by one or more of the other includable corporation