Commensurate reduction
Primary source
Verbatim text below is from the Electronic Code of Federal Regulations (eCFR), a public-domain U.S. government work. Always verify the current version with the eCFR before relying on it for any legal matter.
Full Text
(a) Any program payment or benefit subject to this subpart provided to a legal entity or qualified pass-through entity will be reduced by an amount commensurate with the direct and indirect ownership interest in the legal entity or qualified pass-through entity of each person or legal entity determined to have an average adjusted gross income in excess of the applicable limitation under the standards provided elsewhere in this subpart for the direct recipient of the payments.
(b) Ownership interest in a legal entity will be reviewed to the fourth level of ownership, as specified in § 1400.105, to determine whether a commensurate reduction is applicable and the extent of the reduction. If an ownership interest is not held by a person in the fourth level of ownership in a legal entity, including a qualified pass-through entity, no payment or benefit will be made with respect to the interest.
[73 FR 79273, Dec. 29, 2008, as amended at 85 FR 52040, Aug. 24, 2020; 91 FR 32887, June 2, 2026]
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