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    Created by Michael Wessels
    1. U.S. Code
    2. Title 26
    3. Subtitle A
    4. CHAPTER 1
    5. Subchapter S
    6. PART III

    § 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.