When may an individual be a qualifying person for two corporations?

The correct answer is that an individual may serve as a qualifying person for two corporations when at least 25% of each corporation has common ownership and the individual is a managing employee.

This provision facilitates individuals who are deeply involved in the management of multiple businesses, enabling them to leverage their expertise across these entities. The requirement for at least 25% common ownership ensures that there is a sufficient level of interconnection between the corporations for the individual’s management role to be relevant. By stipulating that the individual must also be a managing employee, the regulation ensures that the person is actively overseeing operations, thereby affirming that they are capable of representing both corporations in matters requiring a qualifying person.

In scenarios where the ownership is less interconnected or where the individual lacks a management role, they would not be eligible to act as a qualifying person for both corporations, emphasizing the importance of ownership percentage and active participation in management.