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that was claimed on the partnership's 1986 return. The
amount of the deduction is the value of certain stock that
the partnership allegedly contributed to a defined benefit
plan for the benefit of one of its partners. The sole
issue for decision is whether the partnership is deemed to
have "paid" the alleged contribution of stock to the
defined benefit plan on the last day of 1986, as provided
by section 404(a)(6), with the result that it is entitled
to deduct the value of the stock on its 1986 return under
section 404(a)(1). Unless stated otherwise, all section
references are to the Internal Revenue Code as in effect
during the year in issue.
FINDINGS OF FACT
Some of the facts have been stipulated by the parties
and are so found. The stipulation of facts and attached
exhibits are incorporated herein by this reference. At the
time the instant petition was filed, the principal place of
business of the partnership, Reed Smith Shaw & McClay, was
located in Pittsburgh, Pennsylvania, and the tax matters
partner worked and resided there. The partnership reported
income and expenses on a calendar year basis and used the
cash receipts and disbursements method of accounting.
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