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compensation includable in the taxpayer's gross income or $2,000.
Sec. 219(b)(1).
The maximum amount that may be deducted is further limited
where the taxpayer or the spouse of a taxpayer is an "active
participant" in certain retirement plans. Sec. 219(g)(1).
Section 219(g)(5) defines "active participant" as an individual
(A) who is an active participant in--
(i) a plan described in section 401(a)
which includes a trust exempt from tax under
section 501(a),
(ii) an annuity plan described in section
403(a),
(iii) a plan established for its
employees by the United States, by a State or
political subdivision thereof, or by an
agency or instrumentality of any of the
foregoing,
(iv) an annuity contract described in
section 403(b), or
(v) a simplified employee pension (within
the meaning of section 408(k)), or
(B) who makes deductible contributions to a trust
described in section 501(c)(18).
The determination of whether an individual is an active
participant shall be made without regard to whether or
not such individual's rights under a plan, trust, or
contract are nonforfeitable. An eligible deferred
compensation plan (within the meaning of section
457(b)) shall not be treated as a plan described in
subparagraph (A)(iii).
There is no evidence and not even a suggestion in the record
that petitioner was an "active participant" for purposes of the
section 219(g) limitation. Yet, respondent contends that
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