### Question
What is the definition of electing small business trust?


### Answer
The definition of **electing small business trust** is as follows in *26 U.S.C. § 1361*:

> any trust if—


(i) such trust does not have as a beneficiary any person other than (I) an individual, (II) an estate, or (III) an organization described in paragraph (2), (3), (4), or (5) of section 170(c),


(ii) no interest in such trust was acquired by purchase, and


(iii) an election under this subsection applies to such trust

#### Citation:
  - *26 U.S.C. § 1361*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter S-Tax Treatment of S Corporations and Their Shareholders > PART I-IN GENERAL**

