Which individual connected to a business is NOT automatically classified as a disqualified person?
Understand the Problem
The question asks us to identify which individual, among the options provided, is NOT automatically considered a disqualified person in relation to a business. This requires understanding the criteria that define a disqualified person under relevant regulations, likely pertaining to employee benefit plans or similar contexts.
Answer
A brother, friend, or a low-paid employee (receiving less than $80,000 direct or indirect compensation) are not automatically classified as disqualified persons.
Based on the search results, a brother or friend are not normally considered automatic disqualified people, assuming they do not have co-ownership. Also, an employee of the organization is not considered a disqualified person if he or she receives less than $80,000 of direct or indirect compensation.
Answer for screen readers
Based on the search results, a brother or friend are not normally considered automatic disqualified people, assuming they do not have co-ownership. Also, an employee of the organization is not considered a disqualified person if he or she receives less than $80,000 of direct or indirect compensation.
More Information
Disqualified persons are individuals or entities that have significant influence over a private foundation or IRA. The IRS focuses on disqualified persons to prevent self-dealing and conflicts of interest.
Tips
It's important to consult the specific regulations and definitions provided by the IRS or relevant financial institutions to determine who qualifies as a disqualified person in particular situations, as the rules can be complex and depend on the context (e.g., private foundation vs. self-directed IRA).
Sources
- Prohibited IRA Transactions - Dille Law, PLLC - dillelaw.com
- Intermediate Sanctions | Insights - Venable LLP - venable.com
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