- 4 - qualified pension plan. In such a case, for married taxpayers who file a joint return, the deduction allowable with respect to either spouse is reduced under a formula prescribed in section 219(g)(2) and (3). That formula generally provides for a phase- out of the deductible amount of the IRA where, for the year 1999, the joint income of the taxpayers exceeds $61,000. Felber v. Commissioner, T.C. Memo. 1992-418, affd. without published opinion 998 F.2d 1018 (8th Cir. 1993). In this case, petitioners' joint income (after their concession of unreported income) totaled $67,638. Under the statutory formula cited, petitioner is not entitled to an IRA deduction for 1999. Petitioner's sole contention is that, because he was not vested in the two plans of his former employer, and his amounts in those plans were forfeited when he terminated his employment, he will never receive any benefits from those plans, and, therefore, he should be allowed a deduction for his IRA contributions for 1999. The answer to that argument is that petitioner was nonetheless an active participant in the two plans of his former employer. He was an active participant because contributions were made to his accounts in the two plans by his former employer. The mere fact that his accounts in these plans were forfeited when his employment terminated, and that he was not vested when his employment terminated, does not change his status as an active participant. Sec. 219(g)(5). A taxpayer isPage: Previous 1 2 3 4 5 6 Next
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