8
219(b)(1). Compensation is defined by section 219(f) as earned
income, as defined by section 401(c)(2). As stated above,
section 401(c)(2) directs us to section 1402(a) and the
definition of "net earnings from self-employment".
Petitioner's adjusted gross income for 1990 of $43,921.48,
after adjustments for his IRA and self-employed health insurance
deductions, consists of interest, dividend, and pension income.
Interest and dividend income is not compensation within the
meaning of section 401(c) because, as noted, such income does not
represent payment with respect to which personal services of the
taxpayer are a material income-producing factor. Likewise,
pension income is expressly excluded from the definition of
compensation by section 219(f)(1). Because petitioner had no net
earnings, and, therefore, no compensation within the meaning of
section 219(f)(1), he is not entitled to deduct any portion of
his IRA contribution. We sustain respondent on this issue.
Decision will be entered
for respondent.
Page: Previous 1 2 3 4 5 6 7 8
Last modified: May 25, 2011