- 2 -
R determined that P is taxable in 1986 on the
amounts contributed to plans 1 and 3 on his behalf for
that year, including the amount merged from plan 2 into
plan 1. R's notice of deficiency was mailed more than
3 years, but less than 6 years, after the filing of P's
1986 tax return. R now admits that, but for judicial
estoppel, P should not be taxed in 1986 on his share of
the merged amount, but rather when it was distributed
to him in 1987. P argues that judicial estoppel does
not apply and that R is barred by the statute of
limitations from asserting a deficiency for 1986.
Held, P's share of the merged amount is not
taxable to P in the year of merger; Fazi I clarified.
Held, further, judicial estoppel does not prevent P
from denying liability. Held, further, the 1986 tax
year is not open for redetermination.
Paul A. Kasicky, for petitioners.
Julia L. Wahl and Janine H. Bosley, for respondent.
OPINION
VASQUEZ, Judge: Respondent determined a deficiency in
petitioners' 1986 Federal income tax in the amount of $160,904.
The deficiency is attributable to the merger of plan 2, a
qualified pension plan, into plan 1, an unqualified pension plan,
and actual corporate contributions made to unqualified pension
plans 1 and 3 on petitioners' behalf.1 The 1986 tax year is only
1 Plan 1 and its related trust were retroactively disqualified in Fazi v.
Commissioner, 102 T.C. 695, 706 (1994), for plan years ending in 1985, 1986,
and 1987. The parties have stipulated that plan 3 and its related trust were
disqualified for the same reasons plan 1 was disqualified, for plan years
ending 1985, 1986, and 1987. However, the parties have not stipulated whether
plan 2 was disqualified prior to its merger into plan 1 in 1986. The only
reference the parties make to plan 2 is that it was frozen in 1982.
(continued...)
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