                  T.C. Summary Opinion 2001-149



                     UNITED STATES TAX COURT



           CHARLES FREDERICK HELD, JR., Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 6972-00S.                 Filed September 24, 2001.


     Charles Frederick Held, Jr., pro se.

     Steven M. Webster, for respondent.



     PAJAK, Special Trial Judge:    This case was heard pursuant to

the provisions of section 7463 of the Internal Revenue Code in

effect at the time the petition was filed.   The decision to be

entered is not reviewable by any other court, and this opinion

should not be cited as authority.   Unless otherwise indicated,

subsequent section references are to the Internal Revenue Code in

effect for the year in issue.
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     Respondent determined a deficiency in petitioner’s 1997

Federal income tax return in the amount of $560.    This Court must

decide whether petitioner is entitled to a deduction in the

amount of $2,000 for contributions to his individual retirement

account (IRA) for the taxable year 1997.

     Some of the facts in this case have been stipulated and are

so found.    Petitioner resided in Charlotte, North Carolina, at

the time he filed his petition.

     Petitioner Charles Frederick Held, Jr. (petitioner) is a

computer network administrator.    During 1997, petitioner was

employed by McNeary Insurance Consulting (McNeary) from January

to mid-February.    During his employment with McNeary, petitioner

was covered under a qualified retirement plan.    Petitioner

contributed $131.03 to the McNeary retirement plan in 1997.

     After leaving McNeary, petitioner was employed by Hynes,

Inc., Harris Group, and Brantech, Inc., for the remainder of

1997. Petitioner was not covered under a qualified retirement

plan during his employment in 1997 by these companies.

     During 1997, petitioner also made contributions which

totaled $2,000 to his IRA.    He deducted the $2,000 in

contributions to his IRA on his 1997 Federal income tax return.

Petitioner’s adjusted gross income for the year in issue exceeded

$35,000.    Respondent disallowed the IRA deduction.

     Petitioner contends that as soon as he ceased working for
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McNeary and was not eligible to participate in a qualified

retirement plan with any of his subsequent employers, he should

be entitled to the IRA deduction because he was not an active

participant in a retirement plan for “the vast majority of the

tax year 1997” and at the time he filed his return.     Respondent

contends that during 1997 petitioner was an active participant in

an employee retirement plan regardless of the length of time he

participated in the plan.     Because petitioner was an active

participant and his adjusted gross income exceeded the applicable

limit, respondent’s position is that petitioner was not eligible

to deduct contributions to an IRA in 1997 under section 219(g).

     In general under section 219(a) an individual is entitled to

deduct the amount contributed to an IRA.     The amount of the

deduction is limited to the lesser of $2,000 or an amount equal

to the compensation includable in a taxpayer’s gross income for

the year.   Sec. 219(b)(1).    In addition, the amount of the

deduction may be limited if the taxpayer was an active

participant for any part of the taxable year.     Sec. 219(g)(1).

An “active participant” is an individual who is an active

participant in a section 401 or other employer retirement plan.

Sec. 219(g)(5).   This limitation results in total disallowance of

the deduction for a single taxpayer when the total adjusted gross

income exceeds $35,000.   Sec. 219(g)(2) and (3).    As relevant

herein, adjusted gross income is determined without regard to any
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IRA deduction.   Sec. 219(g)(3)(A).

     An individual is an active participant in a defined benefit

plan if for any portion of the plan year he is not excluded under

the eligibility provisions of the plan.    Sec. 1.219-2(b), Income

Tax Regs.   The determination of whether an individual is an

active participant shall be made without regard to whether or not

such an individual’s rights under a plan are nonforfeitable.

Sec. 219(g)(5); Hildebrand v. Commissioner, 683 F.2d 57, 59 (3d

Cir. 1982), affg. T.C. Memo. 1980-532; Eanes v. Commissioner, 85

T.C. 168, 170 (1985).    If an employee makes “a voluntary or

mandatory contribution to * * * [an employer retirement plan]

such employee is an active participant in the plan for the

taxable year in which such contribution is made.”    Sec. 1.219-

2(e), Income Tax Regs.    Petitioner concedes that he contributed

to a qualified retirement plan in 1997.    Under section 219(g), we

find that petitioner was an active participant in an employer

retirement plan during 1997.

     Petitioner further asks the Court to correct the rigid

requirements in section 219 to comport with what he believes is

the legislative intent “to permit citizens to save for their

retirement.”   Unfortunately for petitioner, the legislative

history of section 219 shows that the deduction for contributions

to an IRA is to be available only where an individual “does not

participate in any other tax-supported retirement plan.”    H.
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Rept. 93-807, at 128 (1974), 1974-3 C.B. (Supp.) 236, 363.     While

the result to petitioner may appear harsh, we cannot ignore the

plain language of the statute, and, in effect, rewrite the

statute to achieve what would seem a more equitable result.

Eanes v. Commissioner, supra at 171.

     We find that petitioner was an active participant in an

employer retirement plan and because his adjusted gross income

exceeded $35,000, he is not entitled to a deduction for his 1997

contributions to an IRA.   Sec. 219(g)(1) and (2).

     Reviewed and adopted as the report of the Small Tax Case

Division.

                                            Decision will be entered

                                       for respondent.
