- 9 -
Corp., on the other hand, made no mention of whether testimony to
a similar effect was received in that case.
Furthermore, the District Court in Airborne Freight Corp.
did not directly address the question of the deduction
limitations of section 404(a), but instead relied almost entirely
upon section 404(a)(6) and Rev. Rul. 76-28 in holding for the
taxpayer. However, referring also to section 413(b)(7), the
District Court rejected the IRS argument, as phrased by the
court, "that by taking more of a deduction for the 1989 tax year
than had been anticipated, AFC interfered with other employers'
ability to estimate the plan-wide deductible limit". Airborne
Freight Corp. v. United States, 76 AFTR 2d 95-7497, at 95-7499,
96-1 USTC par. 50,004, at 83,015 (W.D. Wash. 1995). The court
went on to reason that because the taxpayer was late in filing
its 1989 tax return, it could not have interfered with other
employers' ability to calculate and claim their deductions. As
indicated by our Opinion and the discussion above, we
respectfully disagree with the District Court's analysis in that
respect.
A final word. We emphasize that what petitioner seeks to
obtain by its one-time bunching of 19 or 20 months of
contributions in a single year is a permanent tax deferral. This
concept is explicitly spelled out in an attachment to the
Declaration of Richard E. V. Harris, in the following words:
"Thus, assuming a [taxpayer] double extends its Federal income
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