the definition includes further references to some sections? What are
these sections, where are they? I would have appreciated a link to the
relevant sections at least. Can someone point me to the right
direction?
"Any direct or indirect 25% foreign shareholder" is defined in the publication linked in the question and that provides further links with addition detail for that definition.
While link only answers are normally not appropriate, this is all that the question seems to be asking for. So the relevant links are to Internal Revenue Code §§ 267, 482, and 707 a.k.a. 26 U.S.C. §§ 267, 482, and 707.
"Internal Revenue Code" is another way of say "Title 26 of the United States Code", and references in federal tax materials to section numbers without further attribution are to sections of the Internal Revenue Code.
In general, IRS Form 5472 is a form that is only filled out by people acting with help from specialist tax attorneys or CPAs. It is highly technical and not something that a lay person should attempt themselves in anything but the most trivial factual situations.
Section 267(b) states:
(b)Relationships
The persons referred to in subsection (a) are:
(1)Members of a family, as defined in subsection (c)(4);
(2)An individual and a corporation more than 50 percent in value of
the outstanding stock of which is owned, directly or indirectly, by or
for such individual;
(3)Two corporations which are members of the same controlled group (as
defined in subsection (f));
(4)A grantor and a fiduciary of any trust;
(5)A fiduciary of a trust and a fiduciary of another trust, if the
same person is a grantor of both trusts;
(6)A fiduciary of a trust and a beneficiary of such trust;
(7)A fiduciary of a trust and a beneficiary of another trust, if the
same person is a grantor of both trusts;
(8)A fiduciary of a trust and a corporation more than 50 percent in
value of the outstanding stock of which is owned, directly or
indirectly, by or for the trust or by or for a person who is a grantor
of the trust;
(9)A person and an organization to which section 501 (relating to
certain educational and charitable organizations which are exempt from
tax) applies and which is controlled directly or indirectly by such
person or (if such person is an individual) by members of the family
of such individual;
(10)A corporation and a partnership if the same persons own—
(A)more than 50 percent in value of the outstanding stock of the
corporation, and
(B)more than 50 percent of the capital interest, or the profits
interest, in the partnership;
(11)An S corporation and another S corporation if the same persons own
more than 50 percent in value of the outstanding stock of each
corporation;
(12)An S corporation and a C corporation, if the same persons own more
than 50 percent in value of the outstanding stock of each corporation;
or
(13)Except in the case of a sale or exchange in satisfaction of a
pecuniary bequest, an executor of an estate and a beneficiary of such
estate.
Section 482 states:
In any case of two or more organizations, trades, or businesses
(whether or not incorporated, whether or not organized in the United
States, and whether or not affiliated) owned or controlled directly or
indirectly by the same interests, the Secretary may distribute,
apportion, or allocate gross income, deductions, credits, or
allowances between or among such organizations, trades, or businesses,
if he determines that such distribution, apportionment, or allocation
is necessary in order to prevent evasion of taxes or clearly to
reflect the income of any of such organizations, trades, or
businesses. In the case of any transfer (or license) of intangible
property (within the meaning of section 367(d)(4)), the income with
respect to such transfer or license shall be commensurate with the
income attributable to the intangible. For purposes of this section,
the Secretary shall require the valuation of transfers of intangible
property (including intangible property transferred with other
property or services) on an aggregate basis or the valuation of such a
transfer on the basis of the realistic alternatives to such a
transfer, if the Secretary determines that such basis is the most
reliable means of valuation of such transfers.
The citation to the relevant regulations under Section 482 are to "Treas. Reg. § 1.482-X" for X= 0, 1, 2, 3, 4, 5, 6, and 8 (Treas. Reg. § 1.482-7 was repealed while it was still a temporary regulation rather than made permanent). All of the Section 482 regulations can be found here.
Section 707(b)(1) states:
(b)Certain sales or exchanges of property with respect to controlled
partnerships
(1)Losses disallowed
No deduction shall be allowed in respect of losses from sales or
exchanges of property (other than an interest in the partnership),
directly or indirectly, between—
(A)a partnership and a person owning, directly or indirectly, more
than 50 percent of the capital interest, or the profits interest, in
such partnership, or
(B)two partnerships in which the same persons own, directly or
indirectly, more than 50 percent of the capital interests or profits
interests.
In the case of a subsequent sale or exchange by a transferee described
in this paragraph, section 267(d) shall be applicable as if the loss
were disallowed under section 267(a)(1). For purposes of section
267(a)(2), partnerships described in subparagraph (B) of this
paragraph shall be treated as persons specified in section 267(b).
