The Board of Trustees of the Sheet Metal Workers' National Pension Fund - Page 1

                                   117 T.C. No. 19                                    

                               UNITED STATES TAX COURT                                

               THE BOARD OF TRUSTEES OF THE SHEET METAL WORKERS’                      
               NATIONAL PENSION FUND, IN ITS CAPACITY AS PLAN                         
               ADMINISTRATOR, Petitioner v. COMMISSIONER OF                           
               INTERNAL REVENUE, Respondent                                           

               Docket No. 6157-00R.                 Filed December 4, 2001.           

                    PP is a multiemployer pension plan established in                 
               1966 to benefit employees in the sheet metal industry.                 
               A second, separate fund (C) was established in 1985 to                 
               provide 3-percent cost of living adjustments (COLAs) to                
               most of PP’s participants.  For 1985 through 1990, C’s                 
               assets were insufficient to pay the 3-percent benefit,                 
               and PP made “ad hoc” payments to each of its                           
               participants who was eligible that year to receive a                   
               benefit from C.  The ad hoc payment equaled the amount                 
               that, in combination with the benefit payable from C,                  
               equaled the 3-percent COLA.  PP’s plan was amended in                  
               March 1992 to add a COLA as of Jan. 1, 1991, equal to                  
               the difference between the 3-percent COLA and the                      
               portion of that amount paid by C.  In October 1992,                    
               PP’s plan was restated as of Jan. 1, 1991, to provide                  
               for a flat 2-percent COLA that was not dependent on the                
               amount paid by C and that was payable to all eligible                  
               employees without regard to whether the provision was                  

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