- 14 -
added).
Against the foregoing background, we turn to an analysis of
whether there was not only includability in income but also
payment as of March 13, 1992. If these two elements are found to
be present, we think there need be no further consideration of
the word "received" in the regulations because the combination of
includability and payment must necessarily be equated with
"received". To better understand our analysis, we repeat the
text of section 404(a)(5):
(5) Other plans.--If the plan is not one included
in paragraph (1), (2), or (3), in the taxable year in
which an amount attributable to the contribution is
includible in the gross income of employees
participating in the plan, but, in the case of a plan
in which more than one employee participates only if
separate accounts are maintained for each employee.
For purposes of this section, any vacation pay which is
treated as deferred compensation shall be deductible
for the taxable year of the employer in which paid to
the employee.
Clearly, section 404(a)(5) on its face provides no clear
guidance to the question before us, since it speaks (first
sentence) in terms of "includable in income" in respect of
deferred compensation other than vacation pay and in terms of
"paid" in respect of vacation pay (second sentence). Under these
circumstances, we find it appropriate, indeed mandated, that we
look to the legislative history, particularly since that history
articulates the 2-1/2 month rule, which is our main concern. See
Hospital Corp. of America v. Commissioner, 107 T.C. 116 (1996),
particularly at 129. Furthermore, the use of legislative history
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