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Date Principal Interest Amount Involved
1/1/96 $203,241 10% $20,324
1/1/97 223,565 10 22,356
1/1/98 245,922 10 24,592
1/1/99 270,514 10 27,051
1/1/00 297,565 10 29,756
124,079
Respondent noted that section 53.4941(e)-1(e)(1), Foundation
Excise Tax Regs., treats prohibited transaction loans as
occurring on the first day of each taxable year in the taxable
period after the year in which the loan occurs and determined on
the basis of these regulations that petitioner owed first-tier
excise taxes as follows:
1996 1997 1998 1999 2000
$1,016 $1,016 $1,016 $1,016 $1,016
–- 2,236 2,236 2,236 2,236
-- -- 3,689 3,689 3,689
–- -- –- 4,058 4,058
–- –- -- –- 4,464
1,016 3,252 6,941 10,999 15,463
Respondent also determined on the basis of these regulations that
petitioner owed a second-tier excise tax of $124,079 for 2001.
On January 19, 1994, Aspects filed a voluntary petition for
bankruptcy. Aspects stated on that petition that it owed
$195,000 to the plan and that the plan was an unsecured creditor.
On February 6, 1995, the bankruptcy court overseeing the
bankruptcy proceeding confirmed Aspects’s “First Amended plan of
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