Contents of Form 8871: Meaning of "related entities"

Information must be supplied on Form 8871 for certain related entities within the meaning of Code section 168(h)(4). Under that section, an entity is related to another entity as follows:

1. The two entities have (i) significant common purposes and substantial common membership or (ii) directly or indirectly substantial common direction or control; or
2. Either entity owns (directly or through one or more entities) a 50 percent or greater interest in the capital or profits of the other. For this purpose, entities treated as related entities under the preceding paragraph shall be treated as one entity.