26 U.S.C. § 1372. Partnership rules to apply for fringe benefit purposes

1. (a)
   (a)

   General rule

   For purposes of applying the provisions of this subtitle which relate to employee fringe benefits—

   1. (1)
      (a)(1)the S corporation shall be treated as a partnership, and
   2. (2)
      (a)(2)any 2-percent shareholder of the S corporation shall be treated as a partner of such partnership.
2. (b)
   (b)

   2-percent shareholder defined

   For purposes of this section, the term “2-percent shareholder” means any person who owns (or is considered as owning within the meaning of section 318) on any day during the taxable year of the S corporation more than 2 percent of the outstanding stock of such corporation or stock possessing more than 2 percent of the total combined voting power of all stock of such corporation.