Part 7 Rulings and Agreements Chap. Exempt Organizations Determinations Manual Sec. It was specifically designed to provide for exemption for title holding organizations with up to 35 shareholders or beneficiaries.
Holdings are limited to interests in real property.
Be a corporation with no more than 35 shareholders or a trust with no more than 35 beneficiaries. Each shareholder or beneficiary may have only one class of stock or beneficial interest. A corporation or trust must permit its shareholders or beneficiaries to dismiss the corporation's or trust's investment adviser, upon a majority vote of the shareholders or beneficiaries. A corporation or trust must not derive more than 15 percent of the total rent for the taxable year from rent attributable to personal property which is leased under or in connection with a lease of real property. A corporation or trust must not derive more than 10 percent of its gross income from otherwise disqualifying income which is incidentally derived from the holding of real property.