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ROBERT H. and RITA E. PERVIER, Petitioners v. COMMISSIONER OF INTERNAL REVENUE, RespondentPervier v. CommissionerDocket No. 8764-77.
United States Tax Court T.C. Memo 1978-410; 1978 Tax Ct. Memo LEXIS 104; 37 T.C.M. (CCH) 1706; T.C.M. (RIA) 78410;October 12, 1978, Filed Rita E. Pervier, pro se.Michael L. Norlander, for the respondent.DAWSONMEMORANDUM OPINION
DAWSON,
Judge : This case was assigned to and heard by Special Trial Judge Charles R. Johnston, pursuant to the provisions ofsection 7456(a), Internal Revenue Code of 1954 , as amended, and General Order No. 6 of this Court, 69 T.C. XV. Special Trial Judge: Respondent determined a deficiency of $ 260.25 for*106 the taxable year 1975 in petitioners' Federal income tax and an excise tax deficiency of $ 60.00 undersection 4973, Internal Revenue Code . The issues for decision are: (1) whether petitioners are entitled to deduct $ 1,000 as a contribution to an individual retirement account under section 219; (2) whether an excise tax undersection 4973 in the amount of $ 60 should be imposed upon petitioners; and (3) whether petitioners are entitled to a deduction of an additional amount of $ 40 as a medical expense. The amount of the medical expense deduction depends upon the resolution of the first issue.The facts have been stipulated and are found accordingly.
Section 219(b)(2)(A)(i) provides that no deduction for contributions to an individual retirement account will be allowable to any individual for a taxable year
if for any part of such year he was anactive participant in a qualified pension plan, profit sharing plan or stock bonus plan. The report of the House of Representatives de minimis situation, we infer that the amount allocated to the petitioner's credit under the Company's profit sharing plan represents his share of the profits for the entire year 1975 and not for the one day on which he became a member. The statute is clear that participation for any part of a year in an employer's plan prevents the deduction for contributions*109 by the employee to his individual retirement account for that year. Deputy v. du 308 U.S. 488">308 U.S. 488 (1940).Pont, It appears that petitioner met all the requirements of section 408(a) and validly created an I.R.A. in 1975. However, he was not entitled to deduct the contribution made to it in that year under section 219. Therefore, the entire contribution was in excess of the amount deductible for the year. The making of such excess contribution subjects petitioner to the excise tax of 6 percent of any excess contribution imposed by
section 4973 , and under section 408(d)(1) the excess contribution is generally taxable when distributed to the contributor. (1978).*110Orzechowski v. Commissioner, 69 T.C. 750">69 T.C. 750We hold respondent has not erred.
In accordance with the foregoing,
Decision will be entered for the respondent .Footnotes
1. Pursuant to General Order No. 6 dated March 8, 1978, the post-trial procedures set forth in
Rule 182, Tax Court Rules of Practice and Procedure↩ , are not applicable to this case.2. H.R. Rep. No. 807, 93rd Cong., 2nd Sess. ↩
3. SEC. 219. RETIREMENT SAVINGS.
* * *
(b) Limitations and Restrictions.--
* * *
(2) Covered by Certain Other Plans.-- No deduction is allowed under subsection (a) for an individual for the taxable year if for any part of such year---
(A) he was an active participant in--
(i) a [qualified profit sharing plan].↩
Document Info
Docket Number: Docket No. 8764-77.
Citation Numbers: 37 T.C.M. 1706, 1978 Tax Ct. Memo LEXIS 104, 1978 T.C. Memo. 410
Filed Date: 10/12/1978
Precedential Status: Non-Precedential
Modified Date: 11/21/2020