-13-
4975(f)(4). Since the prohibited transaction was the assignment
of the accounts receivable by the Corporation to the Plan, the
amount involved is the fair market value of the accounts
receivable on May 31, 1988. In the notice of deficiency,
respondent determined the fair market value of the accounts
receivable assigned to the Plan to be $224,298. Because
petitioner has not provided any contrary evidence, respondent's
determination of the fair market value of the receivables will
stand.
Therefore, petitioner is liable for the first-tier tax. We
sustain respondent's determination.
II. Section 4975(b)
Section 4975(b) imposes a second-tier tax equal to 100
percent of the amount involved where the prohibited transaction
is not corrected within the taxable period. Section 4975(f)(5)
provides that
The terms "correction" and "correct" mean, with respect
to a prohibited transaction, undoing the transaction to
the extent possible, but in any case placing the plan
in a financial position not worse than that in which it
would be if the disqualified person were acting under
the highest fiduciary standards.
In this case, the taxable period began on the date that the
prohibited transaction occurred, May 31, 1988, and ended on the
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