13
On the surface, Pallin's service as a sole proprietor
followed by the formation of Lear and the continuation of the
medical practice as a corporation technically involved a change
in the employer. Lear was the employer after the incorporation,
and Lear did not exist prior to that time. This analysis,
however, ignores that Pallin continued performing the same
services in the corporate form that he had performed as a sole
proprietor. There was no lapse in time between the medical
practice's transition from a sole proprietorship to a
corporation. Pallin continued to own a majority interest in the
practice, and the practice remained in Phoenix. Pallin's
professional duties and responsibilities did not change under the
corporate form, nor did the administration of the medical
practice under the corporate form. The composition of the
medical practice's staff, physicians, or patients did not change
as a result of the transition to corporate form. These factors
lead to the conclusion that the administration of the medical
practice and the substance of Pallin's business operations
remained the same despite the technical change in Pallin's
employment relationship after the formation of Lear.
Accordingly, we conclude that Pallin's years as a sole proprietor
constitute "years of service with the employer" for purpose of
section 415(b)(5). To conclude otherwise would elevate form over
the obvious continuity in Pallin's service before and after the
formation of Lear.
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