Apply the controlled and affiliated group rules to determine whether a parent-subsidiary controlled group

Apply the controlled and affiliated group rules to determine whether a parent-subsidiary controlled group or an affiliated group exists in each of the following independent situations. Circle Y for yes and N for no.

Situation Parent- Subsidiary Controlled Group? Affiliated Group?

Throughout the year, Parent owns 65% of the stock of SubCo. Y N Y N

Parent owns 70% of SubCo. The other 30% of SubCo stock is owned by Senior, a wholly owned subsidiary of Parent. Y N Y N

For 11 months, Parent owns 75% of the stock of SubCo. For the last month of the tax year, Parent owns 100% of the SubCo stock. Y N Y N

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