### Question
What does 5-percent shareholder mean?


### Answer
**5-percent shareholder** has the following meaning in *26 U.S.C. § 664*:

> any person who owns (directly or through the application of section 318(a)) more than 5 percent of the outstanding stock of the corporation which issued such qualified employer securities or of any corporation which is a member of the same controlled group of corporations (within the meaning of section 409(*l*)(4)) as such corporation

#### Citation:
  - *26 U.S.C. § 664*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter J-Estates, Trusts, Beneficiaries, and Decedents > PART I-ESTATES, TRUSTS, AND BENEFICIARIES > Subpart C-Estates and Trusts Which May Accumulate Income or Which Distribute Corpus**

