- 19 -
anticipated contributions exceed such a limitation, the
portion of each such employer's contributions which is not
deductible under section 404 shall be determined in
accordance with regulations prescribed by the Secretary.
We think petitioner's attempt to use the expanded time of
payment provision of section 404(a)(6), as augmented by section
413(b)(7), to enlarge its current contribution deduction is
misguided.
The legislative history explains that the purpose of
amending section 404(a)(6) was simply to place cash basis
taxpayers on the same footing as accrual basis taxpayers insofar
as contributions actually paid into the trust after the close of
the taxable year are concerned. Before the amendment, only
contributions by accrual basis taxpayers made by the time for
filing tax returns could be treated as paid in the year for which
a return was due. This allowed taxpayers sufficient time after
the close of the taxable year to determine the amount of their
contributions to be made to the plan. Section 404(a)(6) extends
this flexibility to cash basis taxpayers. H. Rept. 93-807 (1974)
1974-3 C.B. (Supp.) 236, 336.
In addition, the conference report states that the intent of
permitting grace period contributions is so that they may relate
back to the plan year "for purposes of the minimum funding
Page: Previous 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 NextLast modified: May 25, 2011