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Reorganization” (confirmed plan). Under the confirmed plan, the
plan continued to be listed as an unsecured creditor.
OPINION
Respondent determined that petitioner is liable for both
tiers of excise taxes under section 4975(a) and (b). Respondent
asserts on brief that petitioner is a “disqualified person” under
section 4975(e)(2) as to each of the three loans, that the plan
is a “plan” under section 4975(e)(1), that each of the three
loans is a “prohibited transaction” under section 4975(c), and
that none of the three loans has been “corrected” within the
meaning of section 4975(f)(5). Petitioner does not dispute that
he was a “disqualified person” as to each of the three loans. He
was. See, e.g., sec. 4975(e)(2)(A), (E).1 Nor does petitioner
1 Under subpars. (A) and (E), respectively, of sec.
4975(e)(2), a “disqualified person” is a person who is “a
fiduciary” or “an owner, direct or indirect, of 50 percent or
more of * * * the combined voting power of all classes of stock
entitled to vote or the total value of shares of all classes of
stock of a corporation * * * which is an employer” of any
employees covered by the plan. As relevant herein, petitioner
was a fiduciary (i.e., a trustee) of the plan who was the sole
owner of the stock of an employer (Aspects) whose employees were
covered by the plan. Under sec. 4975(e)(2)(G), a “disqualified
person” also is a corporation of which 50 percent or more of the
combined voting power of all classes of stock entitled to vote or
the total value of shares of all classes of stock is owned by a
person described in sec. 4975(e)(2)(A) or (E). Thus, by virtue
of its ownership by petitioner, Inland also was a disqualified
person as to the second and third loans. The possibility that
Inland may be liable for excise taxes under sec. 4975(a) or (b)
as to the second and third loans is unimportant to our analysis
in that petitioner is jointly and severally liable for any excise
tax imposed on those loans by sec. 4975(a) and (b). See sec.
(continued...)
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