Holding company
A holding company is a company that owns part, a majority, or all of another company’s stock with the sole purpose of owning other companies’ stock. A company is a personal holding company for the purposes of Section 542 of the Internal Revenue Code if at least 60% of the company's adjusted ordinary gross income for the tax year is from dividends, rent, interest, and royalties and if five or fewer individuals own a majority of the company's stock at some point during the latter half of the tax year. A parent holding company refers to a company that owns enough stock in another company to control the election of its board of directors.
Definition from Nolo’s Plain-English Law Dictionary
A company, usually a corporation, that owns and controls other companies.
Definition provided by Nolo’s Plain-English Law Dictionary.
August 19, 2010, 5:17 pm
