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“sponsorship of * * * employee benefits” in Transport Labor I,
and not the phrase “provision of employee benefits” that it used
in Beech Trucking Co.
In Transport Labor I, the Court found that TLC sponsored
certain employee benefits for its driver-employees, including:
(1) A section 401(k) plan; (2) a section 125 flexible benefit
plan; (3) group or individual health insurance; (4) a $5,000
group term life insurance policy; and (5) the option of
purchasing additional group term life insurance. Transp. Labor
Contract/Leasing, Inc. & Subs. v. Commissioner, 123 T.C. at 169.
The Court also found: (1) TLC paid the premiums and any
administrative costs associated with the $5,000 group term life
insurance policy; (2) TLC bore the administrative costs but no
other costs of the section 401(k) plan, the section 125 flexible
spending plan, and the group or individual health insurance; and
(3) each driver-employee paid such other costs through payroll
deductions.30 Id. Only benefit plans established by an employer
for the benefit of such employer’s employees qualify for certain
favorable tax treatment. See, e.g., secs. 401(a), (k), 125(a),
(d), 79(a). Regardless of whether the phrase “sponsorship * * *
of employee benefits” or “provision of employee benefits” was
used, the fact remains that TLC established certain benefit plans
for its driver-employees that could have qualified for such
30See supra note 8.
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