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income tax. For purposes of section 7873, income derived from
"fishing rights-related activity" means income derived from
activity "directly related" to harvesting, processing,
transporting, or selling fish in the exercise of recognized
fishing rights of an Indian Tribe. Sec. 7873(b).
Special Provisions for Individual Retirement Accounts
To determine whether, under the facts of this case, the
"temporary deposit" of income exempt from tax into a retirement
account changes its character requires an examination of the
retirement plan provisions. Special tax provisions apply to a
"qualified retirement plan," as that term is used in section
4974(c), including an individual retirement account.
A trust created or organized in the United States that is
for the exclusive benefit of an individual or his beneficiaries
is an "Individual Retirement Account" (IRA) if it meets certain
statutory requirements under section 408(a). Any IRA is
generally exempt from income tax. Sec. 408(e). An individual is
generally allowed to deduct "qualified retirement contributions"
made for the taxable year. Sec. 219(a). The deduction is
limited to the lesser of $2,000 or the amount of compensation
includable in the taxpayer's gross income for the taxable year.
Sec. 219(b).
"[Q]ualified retirement contributions" include amounts paid
for the taxable year by or "on behalf of an individual" to an IRA
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Last modified: May 25, 2011