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and in the legislative history of such section. See sec.
408(d)(1), as originally enacted by ERISA; H. Conf. Rept. 93-
1280, supra at 340, 1974-3 C.B. at 501. However, in amending
section 408(d)(1) in 1986, Congress omitted any language
indicating, either explicitly or implicitly, that excess
contributions were to be taxed to the contributor upon
distribution from an IRA. Significantly, the legislative history
for the TRA of 1986 does not even address the distribution of
excess contributions from an IRA.
The statute currently provides for basis to the extent of a
taxpayer's "investment in the contract". Absent the requisite
expression of intent in sections 408(d)(1) and 72(e)(6), or in
the legislative histories of those sections, to tax excess
contributions sourced in previously taxed retirement savings, we
think that it would be erroneous to deny petitioner a basis in
his excess contribution notwithstanding that such contribution
would have been without basis prior to the TRA of 1986.
4. Policy
We are satisfied that there is nothing in the legislative
history establishing that Congress intended to include in income
an IRA distribution, the genesis of which was in retirement
savings previously included in income. In fact, to sanction
respondent's interpretation of section 72(e)(6) would not further
the goal that Congress sought to advance by enacting the
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