Richard L. and Marjorie A. Freese - Page 8

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               Petitioner finally contends that because he was an                     
          involuntary member of PERS, was only employed for 9 weeks during            
          1990, only contributed $133.88 in that time, and forfeited all              
          rights under PERS when he resigned effective February 1, 1991, it           
          is inequitable to disallow his IRA deduction.  Under section                
          1.219-2(e) of the Income Tax Regulations, "If an employee makes a           
          voluntary or mandatory contribution to a [defined benefit] plan *           
          * * such employee is an active participant".  The fact that                 
          contributions made by petitioner to PERS were mandatory under               
          State law is irrelevant.                                                    
               Moreover, a person can be an active participant even though            
          he had only forfeitable rights to plan benefits and those rights            
          were, in fact, forfeited prior to becoming vested.  Eanes v.                
          Commissioner, 85 T.C. 168, 170 (1985) (citing Hildebrand v.                 
          Commissioner, 683 F.2d 57, 58 (3d Cir. 1982), affg. T.C. Memo.              
          1980-532)); Wartes v. Commissioner, T.C. Memo. 1993-84.5  Eanes             
          involved a taxpayer who forfeited all rights under an employer's            
          retirement plan when he left after only 3 months.  Despite the              
          short time the taxpayer worked, we held that he was an active               
          participant in his employer's plan and was not entitled to a                

          5    In Eanes v. Commissioner, 85 T.C. 168 (1985), we rejected              
          any distinction based upon the absence of potential for double              
          tax benefits, the crux of the reversal of our decision by the               
          Seventh Circuit Court of Appeals in Foulkes v. Commissioner, 638            
          F.2d 1105 (7th Cir. 1981)(construing a prior version of sec.                
          219), revg. T.C. Memo. 1978-498.  Eanes v. Commissioner, supra at           
          171; see also Johnson v. Commissioner, 661 F.2d 53 (5th Cir.                
          1981), affg. 74 T.C. 1057, 1060 (1980).                                     




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