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fund as of the end of the last taxable year of the fund
ending with or within such taxable year of the employer
exceeding the account limit applicable to such taxable
year of the fund (as adjusted under section
419A(f)(7)). Solely for purposes of this subparagraph,
(i) contributions paid to a welfare benefit fund during
the taxable year of the employer but after the end of
the last taxable year of the fund that relates to such
taxable year of the employer, and (ii) contributions
accrued with respect to a welfare benefit fund during
the taxable year of the employer or during any prior
taxable year of the employer (but not actually paid to
such fund on or before the end of a taxable year of the
employer) and deducted by the employer for such or any
prior taxable year of the employer, shall be treated as
an amount in the fund as of the end of the last taxable
year of the fund that relates to the taxable year of
the employer. Contributions that are not deductible
under this subparagraph are in excess of the qualified
cost of the welfare benefit fund for the taxable year
of the fund that relates to the taxable year of the
employer and thus are treated as contributed to the
fund on the first day of the employer's next taxable
year.
The first sentence of the foregoing regulation reiterates
the rule established by sections 419 and 419A, and General Signal
Corp. & Subs. v. Commissioner, supra, providing that
contributions to a WBF which cause the amount in the VEBA Trust
to be greater than the account limit during a tax year will cause
a reduction in the deductible amount of any contribution made
during the year. The second sentence eliminates the tax benefit
to be obtained by having the taxable year of a WBF end prior to
the taxable yearend of a taxpayer. That sentence causes any
contribution or portion thereof made to a WBF after the fund's
yearend, but prior to the taxpayer's yearend (intrayearend
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