-9-
A prohibited transaction includes any direct or indirect
sale or exchange, or leasing, of any property between a plan and
a disqualified person. Sec. 4975(c)(1)(A). Section 4975(e)(1)
defines "plan" as a trust described in section 401(a) which forms
part of a plan. The parties stipulated that the Plan was a
qualified plan and an exempt trust within the meaning of sections
401(a) and 501(a). A disqualified person includes a fiduciary,
or an owner, direct or indirect, of 50 percent or more of the
stock of a corporation whose employees are covered by the plan.
Sec. 4975(e)(2)(A), (E). The parties stipulated that petitioner
was a "disqualified person" with respect to the Plan, within the
meaning of section 4975(e)(2). A disqualified person also
includes an employer any of whose employees are covered by the
plan. Sec. 4975(e)(2)(C). Therefore, the Corporation is a
disqualified person within the meaning of section 4975(e)(2).
The issue is whether the contribution of the accounts
receivable to the Plan constituted a prohibited transaction under
section 4975(c)(1). In Commissioner v. Keystone Consol. Indus.,
Inc., 508 U.S. 152, 158 (1993), the Supreme Court analyzed
whether the transfer of property was a "sale or exchange" within
the reach of section 4975(c)(1)(A). The Court held that section
4975(c)(1)(A) prohibits the transfer of property in satisfaction
of an employer's obligation to fund a qualified defined benefit
plan. Id. at 159. In construing section 4975(c)(1)(A), the
Court accepted the already-settled meaning of the phrase "sale or
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