(2) Treatment of obligations held by pass-thru entities (A) In general This section shall apply also to— (i) any short-term obligation which is held by a pass-thru entity which is formed or availed of for purposes of avoiding the provisions of this section, and (ii) any short-term obligation which is acquired by a pass-thru entity (not described in clause (i)) during the required accrual period. (B) Required accrual period For purposes of subparagraph (A), the term “required accrual period” means the period— (i) which begins with the first taxable year for which the ownership test of subparagraph (C) is met with respect to the pass-thru entity (or a predecessor), and (ii) which ends with the first taxable year after the taxable year referred to in clause (i) for which the ownership test of subparagraph (C) is not met and with respect to which the Secretary consents to the termination of the required accrual period. (C) Ownership test The ownership test of this subparagraph is met for any taxable year if, on at least 90 days during the taxable year, 20 percent or more of the value of the interests in the pass-thru entity are held by persons described in paragraph (1) or by other pass-thru entities to which subparagraph (A) applies. (D) Pass-thru entity The term “pass-thru entity” means any partnership, S corporation, trust, or other pass-thru entity.
26 USC § 1281(b)(2)
None identified. Default scope is assumed to be the entire title.