### Question
How does the law define 10-percent owned foreign corporation?


### Answer
Under *26 U.S.C. § 988*, **10-percent owned foreign corporation** is defined as:

> any foreign corporation in which the United States person owns directly or indirectly at least 10 percent of the voting stock

#### Citation:
  - *26 U.S.C. § 988*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter N-Tax Based on Income From Sources Within or Without the United States > PART III-INCOME FROM SOURCES WITHOUT THE UNITED STATES > Subpart J-Foreign Currency Transactions**

