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Billy J. Johnson & Ruth Johnson (the Johnsons),
docket No. 9229-94
Addition to Tax Penalty
Sec. Sec.
Year Deficiency 6651(a)(1) 6662(a)
1990 $83,972 --- $16,794
Johnson Systems, Inc. (Systems), docket No. 9230-94
Addition to Tax Penalty
Sec. Sec.
Year Deficiency 6651(a)(1) 6662(a)
1990 $108,675 --- $21,735
We decide the following issues:
1. Whether the Prime Plan is a welfare benefit plan or a
plan deferring the receipt of compensation. We hold it is a
welfare benefit plan.5
2. Whether the Prime Plan is a 10 or more employer plan
described in section 419A(f)(6). We hold it is not.6
5 In light of a concession by respondent that amounts
attributable to contributions to the Prime Plan are not
includable in the gross income of the individual petitioners
under sec. 83 if the plan is determined to be a welfare benefit
plan, our holding on this issue makes it unnecessary to decide
certain other issues in dispute; namely: (1) Whether the Trust
maintains separate accounts for each employee under sec.
404(a)(5), (2) whether the employees' rights are subject to a
substantial risk of forfeiture under sec. 83, (3) whether the
Traegdes extended the period of limitation for assessment of tax
on income recognizable under sec. 83, and (4) whether the
petitioning individuals are liable for penalties under sec.
6662(a). We express no opinion on these issues.
6 Our holding on this issue moots another issue in dispute;
namely, whether contributions to the Prime Plan are current or
capital expenditures. We express no opinion on this issue.
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