- 21 -
those employees or beneficiaries. "[T]he phrase 'purposes other
than for the exclusive benefit of his employees or their
beneficiaries' includes all objects or aims not solely designed
for the satisfaction of all liabilities to employees or their
beneficiaries covered by the trust." Sec. 1.401-2(a)(3), Income
Tax Regs. However, the requirement that the trust be
administered for the exclusive benefit of the employees is not to
be construed literally. Time Oil Co. v. Commissioner, 258 F.2d
237 (9th Cir. 1958), revg. and remanding 26 T.C. 1061 (1956);
Bing Management Co. v. Commissioner, T.C. Memo. 1977-403. To
that effect, the Commissioner has indicated that the exclusive
benefit test of section 401(a)(2) does not prohibit others from
benefiting from a transaction as long as the primary purpose of
the investment is to benefit employees or their beneficiaries.
E.g., Rev. Rul. 73-532, 1973-2 C.B. 128; Rev. Rul. 69-494, 1969-2
C.B. 88.7
7 A revenue ruling represents the Commissioner's position
on the application of tax law to specific facts. See Intel Corp.
& Consol. Subs. v. Commissioner, 100 T.C. 616, 621 (1993), affd.
67 F.3d 1445 (9th Cir. 1995), amended and superseded on denial of
rehearing 76 F.3d 976 (9th Cir. 1995); see also Brook, Inc. v.
Commissioner, 799 F.2d 833, 836 n.4 (2d Cir. 1986), affg. T.C.
Memo. 1985-462, supplemented by T.C. Memo. 1985-614. Revenue
rulings do not constitute binding authority on this Court. Stark
v. Commissioner, 86 T.C. 243, 251 (1986); Neuhoff v.
Commissioner, 75 T.C. 36, 46 (1980), affd. per curiam 669 F.2d
291 (5th Cir. 1982); see also Threlkeld v. Commissioner, 848 F.2d
81, 84 (6th Cir. 1988), affg. 87 T.C. 1294 (1986); Propstra v.
United States, 680 F.2d 1248, 1256-1257 (9th Cir. 1982).
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