Michael Morrissey - Page 7

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            transaction under section 4975(a).  According to petitioner,              
            the prohibited transaction rules do not apply to him because he           
            was the only beneficiary of the Plans at the time of the                  
            transfer.  If he is subject to these rules, petitioner asserts,           
            the transfer was not a "sale or exchange" under the view of               
            this Court as stated in Wood v. Commissioner, 95 T.C. 364                 
            (1990), revd. 955 F.2d 908 (4th Cir. 1992), and Keystone                  
            Consol. Indus., Inc. v. Commissioner, T.C. Memo. 1990-628,                
            affd. 951 F.2d 76 (5th Cir. 1992), revd. 508 U.S. 152 (1993).             
            Petitioner recognizes that the Supreme Court disagreed with our           
            view in Commissioner v. Keystone Consol. Indus., Inc., 508 U.S.           
            152 (1993), but asserts that the Court's decision there applied           
            only to unencumbered property contributed in satisfaction of a            
            funding obligation.  Here, petitioner asserts, he transferred             
            unencumbered property to repay a loan.  Petitioner asserts that           
            repaying the loan was more beneficial to the Plans than leaving           
            it outstanding.                                                           
                 We disagree with petitioner's assertion that he is not               
            subject to the prohibited transaction rules.  Nor do we agree             
            with his assertion that the transfer was not a prohibited                 
            transaction.  We start our inquiry with the relevant text.                
            See Calvert Anesthesia Associates-Pricha Phattiyakul, M.D.,               
            P.A. v. Commissioner, 110 T.C. 285, 289 (1998); Venture                   
            Funding, Ltd. v. Commissioner, 110 T.C. 236 (1998); Trans City            





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