- 29 -
function income.
We have considered all of the contentions and arguments of
the Trustee that are not discussed herein, and we find them to be
without merit and/or irrelevant.20
To reflect the foregoing,
Decision will be entered for
respondent.
20We shall briefly address one of those arguments. The
Trustee argues that the Trust’s investment income at issue is not
subject to the unrelated business income tax because the invest-
ment income of a VEBA described in sec. 501(c)(9) “is not taxable
if spent in furtherance of its exempt purpose.” In support of
that argument, the Trustee relies on certain legislative history
of the Tax Reform Act of 1969 which enacted sec. 512(a)(3)(A) and
(B) into the Code. The Trustee’s reliance on that legislative
history is misplaced. When Congress enacted sec. 512(a)(3)(A)
and (B) in 1969, it placed no specific limitation on the amount
of income that may be set aside by a VEBA. See Tax Reform Act of
1969, Pub. L. 91-172, sec. 121(b), 83 Stat. 537. However, in
1984 Congress decided to impose a limitation on the amount of
income that may be set aside when it enacted sec. 512(a)(3)(E)(i)
into the Code. See Deficit Reduction Act of 1984, Pub. L. 98-
369, sec. 511(b), 98 Stat. 860; H. Conf. Rept. 98-861, at 1161-
1163 (1984), 1984-3 C.B. (Vol. 2) 415-417; see also Staff of
Joint Comm. on Taxation, General Explanation of the Revenue
Provisions of the Deficit Reduction Act of 1984, at 790-791 (J.
Comm. Print 1984).
Page: Previous 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Last modified: May 25, 2011