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IRA deduction. Sec. 219(g)(3)(A).
An individual is an active participant in a defined benefit
plan if for any portion of the plan year he is not excluded under
the eligibility provisions of the plan. Sec. 1.219-2(b), Income
Tax Regs. The determination of whether an individual is an
active participant shall be made without regard to whether or not
such an individual’s rights under a plan are nonforfeitable.
Sec. 219(g)(5); Hildebrand v. Commissioner, 683 F.2d 57, 59 (3d
Cir. 1982), affg. T.C. Memo. 1980-532; Eanes v. Commissioner, 85
T.C. 168, 170 (1985). If an employee makes “a voluntary or
mandatory contribution to * * * [an employer retirement plan]
such employee is an active participant in the plan for the
taxable year in which such contribution is made.” Sec. 1.219-
2(e), Income Tax Regs. Petitioner concedes that he contributed
to a qualified retirement plan in 1997. Under section 219(g), we
find that petitioner was an active participant in an employer
retirement plan during 1997.
Petitioner further asks the Court to correct the rigid
requirements in section 219 to comport with what he believes is
the legislative intent “to permit citizens to save for their
retirement.” Unfortunately for petitioner, the legislative
history of section 219 shows that the deduction for contributions
to an IRA is to be available only where an individual “does not
participate in any other tax-supported retirement plan.” H.
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Last modified: May 25, 2011