- 17 - necessary business expenses pursuant to section 162(a). Our review of the plan documents in question indicated that the reversion of any assets from the VEBA was clearly prohibited. Finally, in Moser v. Commissioner, supra, we disagreed with the Commissioner's argument that the corporation's contribution was excessive, and, therefore, the corporation should not be allowed a deduction for the full amount. The corporation's $200,000 contribution was based on calculations made by a financial consultant to ascertain the full amount of all potential severance benefits and the life insurance and medical insurance premiums that were necessary to fund death, disability, and accident benefits for 1 year. We found that the corporation's original $200,000 contribution had "provided for full funding of the severance benefits and generated income sufficient to fund the annual costs of providing VEBA benefits - no more, no less." Moser v. Commissioner, supra. In Schneider v. Commissioner, T.C. Memo. 1992-24, we held that a personal service corporation was entitled to deduct contributions made to three employee welfare benefit plans established to provide death, disability, and termination benefits to employees and educational benefits to the children of eligible employees. The Commissioner argued that the contributions at issue were capital expenditures because they created a benefit for the taxpayer that lasted substantially beyond the taxable year in which the contributions were made.Page: Previous 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Next
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