- 20 -
contributions were computed by an independent actuary who
determined the amounts necessary to fund the plans for 1 year.
We concluded that "the evidence in this case supports
petitioner's contention that its contribution to each plan for a
particular year relates only to the year in which the payment was
made." Schneider v. Commissioner, supra.
In our view, Moser v. Commissioner, T.C. Memo. 1989-142, and
Schneider v. Commissioner, supra, are distinguishable from the
case at hand. The critical distinctions involve the particular
nature of the benefits funded as well as their permanence and
extent. See INDOPCO, Inc. v. Commissioner, 503 U.S. at 87; A.E.
Staley Manufacturing Co. v. Commissioner, 105 T.C. at 194-195.
The benefit plans at issue in Moser v. Commissioner, supra,
and Schneider v. Commissioner, supra, funded death, disability,
and severance benefits for the employees and, in Schneider,
educational benefits for the employees' children. The most
significant benefits payable under the plans involved in Moser
and Schneider were payable to employees upon the occurrence of an
event, which would terminate their services for the employer.
Employer contributions to these plans tended to boost employee
morale, but we found that the employer's only benefit was its
expectation that its employees were more likely to remain loyal
and perform to the best of their abilities. Schneider v.
Commissioner, T.C. Memo. 1992-24. As a result, we found that
these benefits provided the employer with only incidental or
Page: Previous 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 NextLast modified: May 25, 2011