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Ordinarily, a plan intended to provide accident or health
coverage will contain certain indicia reflecting that purpose. A
plan might state that its purpose is to qualify as an accident or
health plan within the meaning of the Internal Revenue Code and
that the benefits payable under the plan are eligible for income
tax exclusion. Under an accident or health plan, it might be
specified that the benefits payable are those amounts incurred
for medical care in the event of personal injury or sickness.
The plan might also specify that the benefits payable are limited
to amounts incurred for medical care in the event of personal
injury or sickness and provide for the specific reimbursement of
such expenses. A plan might also allow an employee to be
compensated for specific injuries or illnesses, such as the loss
of use of an arm or leg. Although these and similar provisions
are not prerequisites to the existence of an accident or health
plan, their absence plainly militates against a finding that a
pension plan serves a dual purpose. See Berman v. Commissioner,
supra; Caplin v. United States, 718 F.2d 544, 549 (2d Cir. 1983);
Estate of Hall v. Commissioner, supra. None of the expected
provisions are found in petitioner's pension plan. Petitioners
also failed to produce any evidence of any accident or health
claim's ever having been made or paid under the pension plan.
This is strong evidence against the existence of a dual purpose.
Berman v. Commissioner, supra.
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Last modified: May 25, 2011