                          111 T.C. No. 15



                   UNITED STATES TAX COURT



                JOHN F. ROMANN, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, AND BOARD OF TRUSTEES, MEBA
                  PENSION TRUST, Respondents



   Docket No. 8842-96R.                Filed November 4, 1998.



        The MEBA Plan, a collectively bargained, multiemployer
   pension plan, provided notice in an employee publication
   that the MEBA Plan was going to apply to the IRS for an
   advance determination that it continued to be a tax-
   qualified pension plan after adoption of certain plan
   amendments. P, a retiree receiving a pension under the MEBA
   Plan, received this notice and wrote to the IRS asserting
   that the MEBA Plan, after incorporation of the amendments,
   no longer would be tax-qualified. The IRS issued a
   favorable determination letter to the MEBA Plan. P filed a
   petition for declaratory judgment under sec. 7476, I.R.C.
   1986. Respondent Commissioner moved under Rule 215(a)(2),
   Tax Court Rules of Practice and Procedure, that the Board of
   Trustees of the MEBA Pension Trust (the Board) be joined as
   a party to this action. We granted that motion and the
   Board was joined as a party to this action. After the case
   was submitted for decision on the administrative record,
   respondent Commissioner filed a motion to dismiss for lack
   of jurisdiction, asserting that P was not entitled to file
                                 -2-

     suit under sec. 7476, I.R.C. 1986, because as a retired
     participant P did not qualify as an interested party under
     sec. 7476(b)(1), I.R.C. 1986.

          Held: P, as a retired employee of a collectively
     bargained plan, is not an interested party for purposes of
     sec. 7476(b)(1), I.R.C. 1986, where the plan amendments do
     not result in a plan termination.


     John F. Romann, pro se.

     Laurence D. Zeigler, for the respondent Commissioner.

     Paul A. Green, for the respondent Board of Trustees, MEBA

Pension Trust.

                               OPINION

     CHABOT, Judge:    This matter is before the Court on

respondent Commissioner’s motion to dismiss for lack of

jurisdiction.    The issue for decision is whether petitioner is an

“interested party” entitled to file a petition for declaratory

judgment pursuant to section 7476(b)(1),1 with respect to the

continuing qualification of the MEBA Pension Trust Regulations

(hereinafter sometime referred to as the MEBA Plan), under

subchapter D of chapter 1, sec. 401-424.    MEBA is an acronym for

Marine Engineers’ Beneficial Association.

                             Background

     This case was submitted for decision on the basis of an

administrative record as filed by and appropriately certified on

     1
          Unless indicated otherwise, all chapter, subchapter,
and section references are to chapters, subchapters, and sections
of the Internal Revenue Code of 1986, as in effect at the time
the petition herein was filed.
                                  -3-

behalf of all the parties under Rule 217(b)(1).2   The

administrative record as so filed and certified is incorporated

herein by this reference; statements as to facts represented

therein are assumed to be true for purposes of the motion to

dismiss.    Additional facts, for purposes of this motion, have

been found on the basis of petitioner’s admissions.

     When the petition for declaratory judgment was filed, the

address of the Board of Trustees of the MEBA Pension Trust,

hereinafter sometimes referred to as the Board, was in Baltimore,

Maryland.

Procedure

     On March 24, 1995, the Board formally asked the Baltimore,

Md., District Director of the IRS (hereafter sometimes referred

to as the District Director) to issue a favorable determination

letter that the MEBA Plan would remain tax-qualified upon

adoption of certain amendments.    The Board had already issued a

Notice to Interested Parties that it intended to file for such an

advance determination.    This notice was printed in the

March/April 1995 issue of Marine Officer, a newspaper which is

published by the Marine Engineers’ Beneficial Association (AFL-

CIO) and distributed to members and pensioners.    On March 12,

1995, petitioner wrote to the District Director with comments

regarding the continuing tax-qualified status for the MEBA Plan.

     2
          Unless indicated otherwise, all Rule references are to
the Tax Court Rules of Practice and Procedure.
                                  -4-

     On October 6, 1995, the District Director wrote to

petitioner acknowledging receipt of petitioner’s March 12 letter.

The October 6 letter states in part:    “We have received your

comments as an interested party in regard to the Application for

Determination submitted on behalf of [The MEBA Plan].”

     On February 12, 1996, the District Director wrote to the

Board that the District Director had (1) received comments from

interested parties about the plan’s tax-qualified status and that

these comments did not have an adverse effect on the plan’s

qualification and (2) made a favorable determination as to the

qualification of the MEBA Plan.

     Also by letter dated February 12, 1996, the District

Director wrote to petitioner of the District Director’s favorable

determination regarding the MEBA Plan’s qualification.    This

letter states:   “Interested parties who make comments on a

determination letter request may petition the U.S. Tax Court for

a declaratory judgment regarding the determination if they

disagree with the determination.”

     On May 6, 1996, petitioner filed a petition with this Court

asking for a declaratory judgment under section 7476 that the

MEBA Plan as amended does not meet the requirements of section

401(a).

     After petitioner filed an amended petition, respondent

Commissioner filed a motion pursuant to Rule 215(a)(2) to join
                                 -5-

the Board as a party to this action.    We granted that motion, and

the Board was joined as a party.

       After the stipulated administrative record was filed, and

additional exhibits were made part of the administrative record

on petitioner’s motions, we ordered that the instant case was

submitted for disposition on the administrative record under Rule

217.    Respondent Board, on opening brief, challenged petitioner’s

status as an interested party eligible to petition the Court for

declaratory judgment under section 7476.    Respondent Commissioner

challenged, on opening brief, our jurisdiction of certain of

petitioner’s contentions but did not then challenge petitioner’s

standing to bring the instant case.    Petitioner’s brief responded

to respondent Board that he is a participant in the MEBA Plan, an

interested party, and a former employee, and so is entitled to

bring the instant declaratory judgment case.

       Respondent Commissioner then filed the instant motion to

dismiss for lack of jurisdiction because petitioner did not have

standing to bring the instant case.

Facts

       The MEBA Plan

       The MEBA Plan was established as of August 1, 1950, pursuant

to collective-bargaining agreements, and has been continued over

the years by a series of collective-bargaining agreements.    The

MEBA Plan is a multiemployer plan that includes both defined

benefit and defined contribution (money purchase pension)
                                 -6-

components.    The MEBA Plan had received a favorable determination

letter dated May 4, 1987, to take account of amendments adopted

on October 30, 1986.

     As the result of a collective-bargaining agreement,

effective June 16, 1990,3 several changes were made to the MEBA

Plan.    Amendment 91-1 modified the MEBA Plan to include a

supplemental pension benefit, hereinafter sometimes referred to

as the SPB, that was to be paid to eligible pensioners starting

January 1, 1991, and ending the earlier of June 16, 1994, or the

date of the pensioner’s death.    The expiration of the SPB was

extended first to September 30, 1994, and then to December 31,

1994, by collective bargaining agreements entered into in 1994.

     Amendments to the MEBA Medical and Benefits Plan,

hereinafter sometimes referred to as MEBA Medical, resulted in

retired participants’ being required to pay a fee for continued

retiree health insurance coverage.     Pensioners affected by the

amendments to MEBA Medical were given three options, as follows:

(1) Terminate health care coverage; (2) authorize the MEBA Plan


     3
          Both the amended petition and respondent Board’s answer
state that this collective-bargaining agreement was effective
June 16, 1990. Respondent Commissioner’s answer does not deal
with the effective date of this collective-bargaining agreement.
The copy of Amendment 91-1 in the stipulated administrative
record indicates that Amendment 91-1 was “adopted in principle”
on Oct. 17, 1990, was “ratified (as revised)” on Mar. 11, 1991,
and became “effective” on or as of Jan. 1, 1991. These different
dates are symptomatic of lack of clarity at many points in the
record, but do not affect our analyses or conclusions.
                                -7-

to pay all or a portion of the SPB directly to MEBA Medical up to

the amount of the pensioner’s contribution for continued

coverage; or (3) pay the pensioner’s contribution for continued

coverage from the pensioner’s pocket directly to MEBA Medical.

To elect the first option, a participant was required to check a

box and sign an election form that reads as follows:

     I elect on behalf of myself and my family not to be covered
     by the MEBA Medical and Benefits Plan (“Medical Plan”). I
     understand that any Supplemental Pension Benefit payable
     under the MEBA Pension Plan (“Pension Plan”) will be paid
     directly to me, subject to any withholding I may authorize.
     I further understand that, as a result of this election, I
     and my family will be permanently prohibited from
     participating in the Medical Plan as a pensioner. I
     understand that my election to exclude myself and my family
     from coverage as a pensioner under, or otherwise participate
     in, the Medical Plan as a pensioner is irrevocable (and may
     never be changed).

     Table 1 shows the monthly SPB to, and the medical benefits

contribution from, petitioner and other pensioners with less than

20 years of service.

                              Table 1

                       Year      SPB     Medical

                       1991    $148.30   $129.00

                       1992     164.90    143.40

                       1993     184.30    160.30

                       1994     200.20    174.10

     MEBA Plan Instrument

     Article I of the MEBA Plan instrument provides definitions.

Section 1.07 of article I provides as follows:
                                  -8-

     The term “Effective Date of Pension” shall mean the date as
     of which payment of Pension benefits shall commence, which
     is the first day of the month following the month in which
     occurs the latest of:

           (1) the   application for Pension benefits is received at
               the   Plan Office;
           (2) the   Employee terminates Covered Employment; and
           (3) the   Employee’s last vacation period terminates.

     Section 1.08 of article I defines “employee” as follows:

     The term “Employee” shall mean:

     (a)   Licensed Officers employed by Employers;

     (b)   Port engineers, port electricians and hull inspectors
           for whom Employers are obligated to make contributions
           to the MEBA Pension Trust pursuant to collective
           bargaining agreements with the Union;

     (c)   other employees for whom Employers are obligated to
           make contributions to the MEBA Pension Trust pursuant
           to collective bargaining agreements with the Union; and

     (d)   certain employees, officials and representative of (1)
           the Union, and any of its affiliates, (2) the
           Association, (3) the ROU, and (4) the MEBA Pension,
           Medical and Benefits, Vacation, and Training Plans, who
           are not covered by a collective bargaining agreement
           and for whom contributions are made to the MEBA Pension
           Trust as determined by the Trustees subject to the
           Trust Agreement, and to the extent permitted by law,
           the applicable provisions set forth in the collective
           bargaining agreements between the Union or any of is
           affiliates and the Employers.

     (e)   Notwithstanding anything to the contrary, any person
           who is an active participant in or receiving a pension
           from District No. 1, MEBA Pension Plan covering certain
           employees of the Union and the Plan Office (the Staff
           Plan) shall not be considered an Employee.

     Other definitions are included in different parts of the

MEBA Plan instrument.    Section 2A.11 of article II-A provides as

follows:
                                   -9-

     (a)    To Retire (or be Retired or in Retirement), an Employee
            must:

            (1)   withdraw completely from:

                  (A)   Covered Employment;
                  (B)   work aboard any vessel; and
                  (C)   in the case of a port engineer, port
                        electrician or hull inspector, any service in
                        the maritime industry that involves a
                        Licensed Officer’s knowledge or expertise,
                        including but not limited to, knowledge or
                        expertise in construction, repair,
                        operational or maintenance activities.

            (2)   complete taking of his earned vacation; and

            (3)   furnish the Plan Office with satisfactory
                  documentary proof that he has withdrawn from
                  membership in the Union and the ROU, and has
                  surrendered his seaman’s papers to the Trustees.

     A pensioner who wants to return to maritime employment

without penalty must ask the Trustees, in writing, for permission

to do so.    Sec. 2A.12 of article II-A.   Penalties could include

the following: (1) Suspension of the pension for the month in

which the employment occurs, and for up to the next 6 months, (2)

return of any lump sum distribution previously paid, and (3)

forfeiture of eligibility for benefits under MEBA Membership.

Sec. 2A.14 of article II-A.

     Petitioner

     Petitioner is retired and is receiving a pension under the

MEBA Plan.    His regular monthly pension became effective January

1, 1991; the amount for 1991 was $71.16, for 1992 was $74.43, for

1993 was $76.63, and for 1994 was $78.81.     These amounts are in

addition to the SPB, supra table 1.      Petitioner received a check
                              -10-

in the amount of $1,631.30, representing his SPB for January

through November 1991, and thereafter received his SPB monthly.

     Petitioner retains a valid chief engineer’s license issued

by the U.S. Coast Guard for standby use if needed by MEBA.

     On August 22, 1991, petitioner elected to forgo continued

health care coverage through MEBA Medical.   Petitioner checked

option one and signed the election form discussed supra, which

explicitly states that the election to forgo medical benefits for

the participant and the participant’s family is irrevocable.
                                 -11-

                              Discussion

     Section 74764 gives the Tax Court jurisdiction to make a

declaratory judgment with regard to the tax-qualified status of a

retirement plan.

     4
         Sec. 7476 provides, in pertinent part, as follows:

     SEC. 7476.    DECLARATORY JUDGMENTS RELATING TO QUALIFICATION
                   OF CERTAIN RETIREMENT PLANS.

          (a) Creation of Remedy.--In a case of actual
     controversy involving--

                (1) a determination by the Secretary with respect
           to the initial qualification or continuing
           qualification of a retirement plan under subchapter D
           of chapter 1, or

                (2) a failure by the Secretary to make a
           determination with respect to--

                       (A) such initial qualification, or

                       (B) such continuing qualification if the
                  controversy arises from a plan amendment or plan
                  termination,

           upon the filing of an appropriate pleading, the Tax
           Court may make a declaration with respect to such
           initial qualification or continuing qualification. Any
           such declaration shall have the force and effect of a
           decision of the Tax Court and shall be reviewable as
           such. For purposes of this section, a determination
           with respect to a continuing qualification includes any
           revocation of or other change in a qualification.

           (b) Limitations.--

                (1) Petitioner.--A pleading may be filed under
           this section only by a petitioner who is the employer,
           the plan administrator, an employee who has qualified
           under regulations prescribed by the Secretary as an
           interested party for purposes of pursuing
           administrative remedies within the Internal Revenue
           Service, or the Pension Benefit Guaranty Corporation.
                               -12-

     The statute provides that only certain persons are permitted

to file a pleading to initiate a proceeding for such a

declaratory judgment.   Sec. 7476(b)(1).   Petitioner maintains

that he is a permissible petitioner because, in the words of

section 7476(b)(1), he is “an employee who has qualified under

regulations prescribed by the Secretary as an interested party

for purposes of pursuing administrative remedies within the

Internal Revenue Service”.

     Respondent Commissioner contends5 that petitioner does not

qualify as an “interested party” because (1) the MEBA Plan is

collectively bargained and so the applicable regulation is

section 1.7476-1(b)(4), Income Tax Regs.; (2) this regulation

requires an interested party to be a “present” employee, and

petitioner had retired and so was not a present employee at the

relevant time of determination; and (3) petitioner is not an

interested party under any other provision in the regulations.

     Petitioner responds that he qualifies as an interested party

because (1) he is considered retired for pension purposes only;

(2) respondent Commissioner misinterprets section 1.7476-1(b)(4),

Income Tax Regs.; (3) the Supreme Court’s interpretation of the

term “employee” in Robinson v. Shell Oil Co., 519 U.S. 337

(1997), should be applied to section 7476; and (4) in any event



     5
          Respondent Board “concurs in the filing and granting”
of respondent Commissioner’s motion to dismiss.
                                -13-

he is an interested party under section 1.7476-1(b)(5), Income

Tax Regs., relating to plan terminations.

     We agree with respondent Commissioner.

     (1) Preliminary Comments

     Firstly, it is well settled that this Court can proceed in a

case only if we have jurisdiction and that any party, or the

Court sua sponte, can question jurisdiction at any time, even

after the case has been tried and briefed.    Normac, Inc. & Normac

International v. Commissioner, 90 T.C. 142, 146-147 (1988); Kahle

v. Commissioner, 88 T.C. 1063 n.3 (1987), and cases cited

therein.   We have jurisdiction to determine jurisdiction and

“whenever it appears that this Court may not have jurisdiction to

entertain the proceeding that question must be decided.”

Wheeler’s Peachtree Pharmacy, Inc. v. Commissioner, 35 T.C. 177,

179 (1960); 508 Clinton Street Corp. v. Commissioner, 89 T.C.

352, 353 n.2 (1987).

     Where this Court’s jurisdiction is duly challenged, the

jurisdiction must be affirmatively shown.     Wheeler’s Peachtree

Pharmacy, Inc. v. Commissioner, 35 T.C. at 180; Louisiana Naval

Stores, Inc. v. Commissioner, 18 B.T.A. 533, 536-537 (1929).

In particular, petitioner has the burden of proving that the

jurisdictional requirements of section 7476 have been met.      Rule

217(c)(1)(A); Halliburton Co. v. Commissioner, 98 T.C. 88, 94

(1992); BBS Associates, Inc. v. Commissioner, 74 T.C. 1118, 1120-
                               -14-

1121 (1980), affd. without published opinion 661 F.2d 913 (3d

Cir. 1981).

     Secondly, respondent Commissioner acknowledges advising

petitioner that petitioner was an interested party, not only

during the administrative processing of respondent Board’s

application, but also in the pleadings in the instant case.

Respondent Commissioner maintains that these actions cannot serve

to give petitioner interested party status because “The Court’s

jurisdiction is statutory and cannot be enlarged by the actions

of the parties.”   Petitioner responds as follows:

     24.        Admits the fact that Commissioner advised the
           petitioner that he was an interested party, entitled to
           file a Petition For Declaratory Judgment in the U.S.
           Tax Court. (Administrative Record, Exhibits 4-D, 9-I
           and 10-J)

     25.        Admits that the Court’s jurisdiction is statuatory
           [sic], and that the U.S. Supreme Court has power to
           prescribe that the statute shall not abridge, enlarge
           or modify the substantive right of the petitioner as an
           interested party, to appeal the decision of the
           Commissioner who abused discretion in the issuance of a
           Favorable Leter [sic] of Determination dated February
           12, 1996, to the Board of Trustees, MEBA Pension Trust,
           #001, “out of time”, (See Official Court Record,
           Petitioners Opening Brief, Section VIII ARGUMENT, NOTE
           11, on pages 78 and 79 at (b)(i)(ii), and “based on
           information supplied” (Administrative Record, Exhibit
           11-K, para. 1) instead of issuing a “timely” Letter of
           Favorable Determination, based upon required
           information supplied for determination of the “Entire
           Plan As Amended. (U.S. Code, Title 28, Rule 2072,
           Judiciary & Judicial Procedure). (Official Court
           Record, Petitioners Opening Brief, Section VIII,
           ARGUMENT at NOTE & NOTE 8, pages 65 through 72).

     Respondent is correct that our jurisdiction cannot be

enlarged by agreement of the parties, or waiver, or failure to
                                -15-

object.   Freedman v. Commissioner, 71 T.C. 564 (1979); see, e.g.,

Loftus v. Commissioner, 90 T.C. 845, 861 (1988), affd. without

published opinion 872 F.2d 1021 (2d Cir. 1989).   This is true of

Federal courts generally, and not merely because of some special

characteristic of this Court.    Bender v. Williamsport Area School

Dist., 475 U.S. 534, 541 (1986).

     Thirdly, a legislative regulation, which is issued pursuant

to a specific congressional grant of authority to the Secretary

of the Treasury, is entitled to greater deference than an

interpretive regulation, which is promulgated under the general

rulemaking power vested in the Secretary by section 7805(a).

Peterson Marital Trust v. Commissioner, 102 T.C. 790, 797-798

(1994), (and cases cited therein), affd. 78 F.3d 795, 798 (2d

Cir. 1996).   Section 1.7476-1(b), Income Tax Regs. (relating to

interested parties), has been promulgated under the specific

instruction in section 7476(b)(1) that a person who wishes to be

an employee party-petitioner in a section 7476 declaratory

judgment proceeding must be one “who has qualified under

regulations prescribed by the Secretary as an interested party

for purposes of pursuing administrative remedies within the

Internal Revenue Service”.   Accordingly, this regulation is a

legislative regulation.   To be valid, section 1.7476-1(b), Income

Tax Regs., need not be the only, or even the best, construction

of section 7476(b)(1).    See Atlantic Mutual Ins. Co. v.
                               -16-

Commissioner, 523 U.S. ___, 118 S. Ct. 1413, 1418 (Apr. 21,

1998).   The Supreme Court has stated that a reviewing court

     need not conclude that the agency construction was the only
     one it permissibly could have adopted to uphold the
     construction, or even the reading the court would have
     reached if the question initially had arisen in a judicial
     proceeding. [Chevron U.S.A., Inc. v. Natural Resources
     Defense Council, Inc., 467 U.S. 837, 843 n.11 (1984);
     citations omitted.]

     We proceed to consider first whether petitioner qualifies as

an interested party under section 1.7476-1(b)(4), Income Tax

Regs., relating to collectively bargained plans.   If petitioner

does not so qualify, we then consider whether section 1.7476-

1(b)(5), Income Tax Regs., relating to plan terminations, applies

to the instant case in such a way as to enable petitioner to

qualify as an interested party.

     (2) Collectively Bargained Plans

     Section 1.7476-1(b), Income Tax Regs., provides the detailed

rules for determining who is “an employee who has qualified * * *

as an interested party”, within the meaning of section

7476(b)(1).   Paragraph (b)(1) of the regulation provides the

general rule, “If paragraphs (b)(2), (3), (4), and (5) of this

section do not apply”.   Paragraph (b)(2) of the regulation

supersedes paragraph (b)(1) in the case of certain plans covering

a principal owner.   Paragraph (b)(3) of the regulation supersedes

paragraphs (b)(1) and (2) in the case of certain plan amendments.
                               -17-

Paragraph (b)(4)6 of the regulation supersedes paragraphs (b)(1),

(2), and (3) in the case of collectively bargained plans.


     6
        Sec. 1.7476-1, Income Tax Regs., provides, in pertinent
part, as follows:

     SEC. 1.7476-1 Interested parties.

                 *    *    *    *     *   *    *

          (b) Interested parties--

                 *    *    *    *     *   *    *

               (4) Collectively bargained plans. In the case of
          an application with respect to a plan described in
          section 413(a) (relating to collectively bargained
          plans), paragraphs (b)(1), (2) and (3) of this section
          shall not apply and all present employees covered by a
          collective-bargaining agreement pursuant to which the
          plan is maintained shall be interested parties.

               (5) Plan terminations. In the case of an
          application for an advance determination with respect
          to whether a plan termination affects the continuing
          qualification of a retirement plan, paragraphs (b)(1),
          (2), (3) and (4) of this section shall not apply, and
          all present employees with accrued benefits under the
          plan, all former employees with vested benefits under
          the plan, and all beneficiaries of deceased former
          employees currently receiving benefits under the plan,
          shall be interested parties.

                 *    *    *    *     *   *    *

          (c) Special rules. For purposes of paragraph (b) of
     this section and section 1.7476-2:

               (1) Time of determination. The status of an
          individual as an interested party and as a present
          employee or former employee shall be determined as of a
          date determined by the applicant, which date shall not
          be earlier than five business days before the first
          date on which the notice of the application is given to
          interested parties pursuant to section 1.7476-2 nor
          later than the date on which such notice is given.
                                -18-

Paragraph (b)(5) of the regulation supersedes paragraph (b)(1),

(2), (3), and (4) in the case of plan terminations.

     The MEBA Plan instrument states in its preamble that it is a

collectively bargained plan.    All the parties herein state that

it is a collectively bargained plan.   We have so found.

Accordingly, the determination of whether petitioner has

qualified as an interested party under Treasury Regulations is to

be made under section 1.7476-1(b)(4), Income Tax Regs.7    Under

this provision, “present employees covered by a collective-

bargaining agreement pursuant to which the plan is maintained

shall be interested parties.”

     The regulation does not define the term “present employee”.

However, the meaning of this term may be gleaned from the

regulation’s use of other terms.   In particular, (1) paragraph

(b)(5) of the regulation (discussed infra) distinguishes between

“present employees”, “former employees”, and “beneficiaries of

deceased former employees”; (2) paragraph (c)(1) of the

regulation distinguishes between “present employee” and “former

employee”; and (3) paragraph (c) of section 1.7476-2, Income Tax

Regs., provides one set of notification rules for present

employees in subparagraph (1) thereof and a different set of



     7
          The question of whether sec. 1.7476-1(b)(5), Income Tax
Regs., supersedes paragraph (b)(4) of the regulation is dealt
with infra.
                                 -19-

notification rules for former employees and beneficiaries in

subparagraph (2) thereof.

     Based on the foregoing, we conclude that these regulations

distinguish between present employees and former employees as

mutually exclusive categories.    As a result, if petitioner’s

status is that he is a former employee, then he would not be a

present employee and, as a result, he would not be an interested

party within the meaning of section 1.7476-1(b)(4), Income Tax

Regs.

     Section 1.7476-1(c)(1), Income Tax Regs., provides that the

status of an individual as an interested party is to be

determined as of a date generally during a 6-business-day period

ending on the date that the relevant notice was given to

interested parties.   Supra note 6.     Under this regulation the

individual applicant is to determine which date during this

period is to be the status determination date.

     The parties have not directed our attention to, and we have

not found, anything in the record that shows that the Board has

determined a date, in conformity with section 1.7476-1(c)(1),

Income Tax Regs.   Nor does the administrative record show

precisely when the notice was given.     However, the administrative

record shows that the notice was given by an announcement

published in the March/April 1995 issue of a publication called

Marine Officer, and we conclude that petitioner must have

received the notice on or before March 12, 1995, the date he
                               -20-

first wrote to the District Director about the Plan.   We think it

is more likely than not that that issue of Marine Officer was

first distributed in February or early March 1995.

     Under these circumstances, in order to carry his burden of

proof as to jurisdiction, petitioner must persuade us that it is

more likely than not that he was a present employee at whatever

time we might reasonably conclude was the correct determination

period under section 1.7476-1(c)(1), Income Tax Regs., most

likely some time in February or early March 1995.

     Petitioner’s pension became effective January 1, 1991.

Under section 1.07 of article I of the MEBA Plan instrument,

petitioner’s pension became effective the month after the month

in which the latest of the following occurred:   (1) Petitioner’s

application for pension was received at the plan office; (2)

petitioner ended his covered employment; and (3) petitioner ended

his last vacation period.   All three of these requirements had to

have been met by December 1990 for petitioner’s pension to have

been effective on January 1, 1991.

     Under section 2A.11 of article II-A of the MEBA Plan

instrument, a participant is considered retired when she or he

completely withdraws from covered employment.    For petitioner’s

pension to have become effective January 1, 1991, petitioner must

have withdrawn completely from covered employment before that

date.
                              -21-

     Petitioner does not contend that he returned to employment

covered under the MEBA Plan at any time after the January 1,

1991, effective date of his pension.    Indeed petitioner does not

contend that he returned to any employment on behalf of any of

the employers in the MEBA Plan after January 1, 1991.    Thus, for

any time after that date, including early 1995, petitioner was a

former employee and he was not a present employee.    Accordingly,

we conclude that, based on our findings as to the timing of the

determination period under section 1.7476-1(c)(1), Income Tax

Regs., petitioner was not a present employee during that period,

and so petitioner cannot be an interested party under paragraph

(b)(4) of section 1.7476-1, Income Tax Regs.8   This conclusion is

based on our analysis of the evidence in the record and our

conclusion as to what the preponderance of the evidence leads to.

Thus, the burden of proof is immaterial to this conclusion.

Martin Ice Cream Co. v. Commissioner, 110 T.C. 189, 210 n.16

(1998), and cases cited therein.

     Petitioner contends that he is “classified as *    *   *

retired for pension purposes only.”    Petitioner further argues

that--


     8
          To the same effect under paragraph (b)(1) of sec.
1.7476-1, Income Tax Regs., see Dillon v. Commissioner, T.C.
Memo. 1993-239, affd. without published opinion 16 F.3d 1227 (8th
Cir. 1994), and under paragraph (b)(3) of this regulation, see
Jones v. Commissioner, T.C. Memo. 1980-512, affd. without
published opinion 676 F.2d 710 (9th Cir. 1982); see also Day v.
Commissioner, T.C. Memo. 1985-251, nn.12-13.
                                   -22-

          (b) Article 2A.11 of the Regulations, states, “To be
     considered retired, an Employee must ---”. The petitioner
     is still “an employee” under Article 2A.11, and remains an
     employee, notwithstanding Article 1.08 of the MEBA TRUST
     REGULATIONS (Administrative Record, Exhibit 1-A, pages “4”
     and “5” of the Trust Regulations. Otherwise, the petitioner
     could not comply with the provisions of Article 2A.13 of the
     MEBA TRUST REGULATIONS in respect to “Re-employment of
     Pensioners During Conditions of Officer Shortages”.
     (Response Exhibit #2, and Response Exhibit #3).

     Petitioner misreads the cited provision of the MEBA Plan

instrument.   As can be seen from the text of section 2A.11 of

article II-A of the MEBA Plan instrument,9 attainment of retired


     9
          2A.11    RETIRE AND MARITIME EMPLOYMENT DEFINED

          (a) To Retire (or be Retired or in Retirement), an
     Employee must:

                  (1)   withdraw completely from:

                        (A)   Covered Employment;

                        (B)   work aboard any vessel; and

                        (C)   in the case of a port engineer, port
                              electrician or hull inspector, any
                              service in the maritime industry that
                              involves a Licensed Officer’s knowledge
                              or expertise, including but not limited
                              to, knowledge or expertise in
                              construction, repair, operational or
                              maintenance activities.

                  (2)   complete the taking of his earned vacation;
                        and

                  (3)   furnish the Plan Office with satisfactory
                        documentary proof that he has withdrawn from
                        membership in the Union and the ROU, and has
                        surrendered his seaman’s papers to the
                        Trustees.
                               -23-

status can be achieved only by taking steps which effectively

preclude any current employment and make unlikely any future

employment.   Section 2A.13 of article II-A of the MEBA Plan

instrument provides for exceptional circumstances under which a

retiree could return to covered employment without suffering the

full range of penalties provided by sections 2A.12 and 2A.14.

Those circumstances are war or national emergency (subsection

(a)(1)) and shortage of personnel (subsection (a)(2)).    Those

circumstances come into play only if (a) the war, national

emergency, or shortage of personnel exists; (b) the pensioner

notifies the MEBA Plan trustees in writing; and (c) the MEBA Plan

trustees permit the pensioner to return to covered employment.

We have not found, and petitioner has not directed our attention

to, anything in the record in the instant case that suggests that

any such specified emergency condition existed, that petitioner

requested permission to return to covered employment, or that

petitioner was granted permission to return to covered

employment.

     Thus, as we see the situation, the provisions of the MEBA

Plan instrument to which petitioner directs our attention make it

clear that petitioner was no longer a present employee under the

MEBA Plan instrument throughout the relevant period for

determining petitioner’s status.
                               -24-

     Petitioner also appears to assert that respondent

Commissioner misinterprets section 1.7476-1(b)(4), Income Tax

Regs., as follows:

     19.        (a) Denies that Section 1.7476-1(b)(4), Income Tax
           Regs., provides that “interested parties” with respect
           to an application for a determination regarding a
           collectively bargained plan must be “present employees
           covered by a C/B agreement pursuant to which plan is
           maintained-------” Petitioners [sic] denial is
           grounded upon alleged mis-interpretation of Inc. Tax.
           Regulation 1.7476-1(b)(4), by the Respondent
           (Commissioner IRS)

                (b) It is sometimes considered “unfortunate” that
           retired employees must be covered under a collectively
           bargained plan, instead of being able to enjoy the
           liberty to appoint their own representative(s). If
           such were possible, this litigation may have been
           avoided. (See Official Court Record, Petitioners [sic]
           REPLY to Respondent (Commissioner IRS) ANSWER to
           Amended Petition For Declaratory Judgement (Retirement
           Plan) on page “21”, under “F-14”, and continuing on
           page “22”.) (Administrative Record, Exhibit 14-N, page
           17, para. “9”, An Amicus on page “7” reproduced as page
           “43” as a part of the Official Court Record in
           Petitioners [sic] Opening Brief, a reference to entire
           paragraph at the top of the page).

                (c) The petitioner alleges, that, it would appear
           that the Secretary, in writing the remedial
           mechanism(s) available under I.R.C. 1.7476(a), [sic]
           would have been mindful of paragraph (b) above, and so
           worded Section 1.7476(b)(4) [sic] of the Income Tax
           Regulations to insure that all present employees
           covered by a Collective Bargaining Agreement pursuant
           to which the plan is maintained, “shall be interested
           parties”.

     We conclude that respondent Commissioner has correctly

interpreted section 1.7476-1(b)(4), Income Tax Regs.

     Paragraph (1) of section 7476(b) provides that a declaratory

judgment proceeding may be brought under section 7476 “only” by a
                               -25-

person who fits within a category listed in that paragraph.     The

only category that petitioner claims to fit within is--

          an employee who has qualified under regulations
          prescribed by the Secretary as an interested party for
          purposes of pursing administrative remedies within the
          Internal Revenue Service * * *.

Petitioner cannot fit within that category, and thus cannot bring

the instant proceeding, unless he qualifies under the applicable

regulations.

     Petitioner claims that he qualifies under section 1.7476-

1(b)(4), Income Tax Regs.   This regulation provides only one

category of persons who are interested parties--

     all present employees covered by a collective-bargaining
     agreement pursuant to which the plan is maintained * * *.

Because this regulation does not provide any other category of

persons who are interested parties,10 it follows that interested

parties under paragraph (b)(4) of the regulation must be “present

employees covered by a collective-bargaining agreement pursuant

to which the plan is maintained”.

     Petitioner’s contention in paragraphs 19(a) and (b) does not

specifically call for invalidation of the regulation, or judicial

rewriting of the regulation, but rather appears to be a plea that

retired employees should have some special status that would

entitle them to interested party status.


     10
          Sec. 1.7476-1(b)(6), Income Tax Regs., provides a
series of exceptions; however, none of these exceptions applies
to paragraph (b)(4) of the regulation.
                               -26-

     It is clear from the legislative history that the statute

gives a special status to employees and that this was not

inadvertent.   See infra Appendix.    However the statute does not

in terms require that retired employees must, as petitioner

suggests, be "able to enjoy the liberty to appoint their own

representative(s)."   Our examination of the legislative history

does not bring to light any such intended requirement.     Our

examination of those portions of the record that petitioner cites

supra in his paragraph 19(b) does not bring to light any such

requirement.

     On the contrary, it clearly emerges that the Congress

entrusted the Treasury Department with the specific task of

writing interested party regulations.    The Treasury Department

has done so.   As our analysis, supra, shows, in most instances

only present employees of one sort or another can qualify as

interested parties under the regulations.    In the case of plan

terminations, the focus shifts to certain former employees and

beneficiaries of deceased former employees.    Perhaps the

objectives sought to be furthered by ERISA would have been better



served if the Treasury Department had issued regulations more in

line with petitioner’s suggestion.    However, ERISA does not

require the Treasury Department to do so, whether we focus merely

on the enacted words or take into account the legislative history

in order to understand the enacted words.    Under these
                               -27-

circumstances, we shall not rewrite the authorized regulations to

meet petitioner’s concerns.   See Newborn v. Commissioner, 94 T.C.

610, 636-637 (1990).

     Petitioner also asserts that the Supreme Court’s decision in

Robinson v. Shell Oil Co., 519 U.S. 337 (1997), requires section

7476 to be construed to include petitioner as an interested

party.   We disagree.

     The careful unanimous opinion of the Supreme Court in

Robinson v. Shell Oil Co. points out that “employee” has a

variety of meanings in sections 701(c), 703(h), 706(g)(1), and

717(a), (b), and (c) of title VII of the Civil Rights Act of

1964, Pub. L. 88-352, 78 Stat. 254, 257, 261, as amended.    The

opinion concludes that “employee” as used in section 704(a) of

Pub. L. 88-352, 78 Stat. 257, is ambiguous and further concludes

that the purposes of that section 704(a) would best be served by

construing “employee” to include “former employee.”

     In the instant case, the plain language of the statute makes

it clear that not every employee will be an “interested party”.

Also, in the instant case the plain language of the statute

specifically commits to the Treasury Department the task of

defining which employees are to be interested parties.   Finally,

in the instant case the regulations promulgated under this

specific grant of authority make it clear that under some

circumstances certain former employees can be interested parties.

Thus, the analysis appearing in Robinson v. Shell Oil Co., supra,
                                -28-

does not apply so as to require that we interpret the term

“present employee” in section 1.7476-1(b)(4), Income Tax Regs.,

to include “former employee.”

     We hold, for respondent Commissioner, that petitioner is not

an interested party within the meaning of section 1.7476-1(b)(4),

Income Tax Regs.

     (3) Plan Terminations

     Petitioner also asserts that there were at least three plan

terminations and thus section 1.7476-1(b)(5), Income Tax Regs.,

(supra note 4), applies to the instant case, and he qualifies as

an interested party under that provision of the regulations.   We

have examined the situation as disclosed by the record and do not

understand that there has been a termination of the MEBA Plan.

     Firstly, we have not found, and petitioner has not directed

our attention to, any statutory or regulatory provision or any

case law, dealing with section 7476, under which the events in

the record could fairly be described as a termination or partial

termination.

     Secondly, we note that section 411(d)(3) deals with

terminations.   We have not found, and petitioner has not directed

our attention to, any statutory or regulatory provision or any

case law, dealing with section 411, under which the events in the
                               -29-

record could fairly be described as a termination or partial

termination.11

     Thirdly, we note that 29 U.S.C. sec. 1341A deals with

terminations of multiemployer plans.   The events that petitioner

complains of do not constitute terminations within the meaning of

29 U.S.C. sec. 1341A.   See Kershaw Multiemployer Plans--Special

Rules, 359-3d, Tax Mgmt. (BNA), A-35 (1994).

     We hold, for respondent, that section 1.7476-1(b)(5), Income

Tax Regs., does not apply to the instant case.

     As a result of the foregoing, we conclude that petitioner is

not an interested party within the meaning of section 7476(b)(1),

and thus he does not have standing to bring the instant case.



                   __________________________

     It must be clearly understood that our dismissal is only for

lack of jurisdiction because, under the statute and the

legislative regulations, petitioner does not have the standing to

bring the instant case.   We do not rule, either expressly or by

implication, on the merits of any of the parties’ contentions as

to whether the MEBA Plan is tax-qualified.   Further, we do not

rule, either expressly or by implication, on whether petitioner

may initiate a proceeding under any other part of ERISA, the


     11
          See sec. 1.411(d)-2(b), Income Tax Regs.; 1 Lieber,
Lieber on Pensions, secs. 3:10,040, 3:10,050, at 3-250, 3-252
(1992).
                              -30-

Employee Retirement Income Security Act of 1974, Pub. L. 93-406,

88 Stat. 829, as amended, to secure any of the relief he contends

he is entitled to.

     In light of the foregoing,

                                     Respondent Commissioner’s

                              motion to dismiss will be granted,

                              and an appropriate order will be

                              entered dismissing the instant case

                              for lack of jurisdiction.
                                   -31-

                                 Appendix

     On April 18, 1973, the Senate Committee on Labor and Public

Welfare reported S. 4, the Retirement Income Security for

Employees Act.   S. 4 did not include provisions for declaratory

judgments.   119 Cong. Rec. 12926 (1973).

     Section 601(a) of S. 1179, as reported on August 2, 1973, by

the Senate Committee on Finance, provided for declaratory

judgments as to tax-qualified status of employee plans.   Proposed

section 7477(a)(2) provided as follows:

     SEC. 7477. PROCEDURE.

          (a) Right To Bring Action.--

                  *    *     *      *       *   *   *

               (2) Actions brought by employees; intervention by
          employer.--An action for a declaratory judgment with
          respect to a determination obtained by an employer or
          by a trustee may also be brought by an individual who
          was an employee of the employer during the period with
          respect to which the judgment is sought. In any such
          action brought by an employee, the employer may
          intervene.

     In S. Rept. 93-383, to accompany S. 1179, the Finance

Committee stated as follows:

          The committee believes that both employers and
     employees should have a right to court adjudication in the
     situations described above. The bill deals with the problem
     by providing that, in the event of an unfavorable
     determination (or failure to make a determination), the
     employer may ask the Tax Court for a declaratory judgment as
     to the status of a new plan, a plan amendment or a plan to
     be terminated. In addition, the committee has decided that
     interested employees should be allowed to participate in the
     consideration by the Service of an employer’s request for a
     determination and any controversy connected with it. An
     employee who intervenes in the Service’s determination
                               -32-

     procedure is to be entitled to receive a copy of the
     determination issued by the Service in connection with the
     proceeding. If the employee questions a Service
     determination with respect to the qualification of a
     particular plan, he may petition the Tax Court to issue a
     declaratory judgment as to the status of the plan.

          The committee believes that this procedure is desirable
     because it will permit all interested parties to the
     controversy (the Government, the trustee, the employer, and
     his employees) to have an opportunity to participate in the
     administrative determination of the matter and to have an
     opportunity to contest the Service determination of the
     matter.

S. Rept. 93-383, 113 (1973), 1974-3 C.B. (Supp.) 80, 192.    On

September 18, 1973, the Senate began floor debate on S. 4, and

adopted as a substitute, an amendment which embodied an agreement

between leaders of the Senate Finance Committee and the Senate

Labor and Public Welfare Committee.    The substitute embodied

elements of S. 4, as reported, and S. 1179, as reported.    In

particular, section 601(a) of the substitute includes precisely

the same language as section 601(a) of S. 1179, relating to

declaratory judgment actions brought by employees.

     On September 19, 1973, after the Senate completed action on

further amendments to S. 4, the Senate took up H.R. 4200, a bill

previously passed by the House of Representatives, and added the

language of S. 4, as amended, as an amendment at the end of H.R.

4200.   119 Cong. Reg. 30416 (1973).   The Senate then passed H.R.

4200, as thus amended.   119 Cong. Rec. 30428 (1973).

     As a result of the foregoing, the language of H.R. 4200 as

amended and passed by the Senate, insofar as it related to
                               -33-

declaratory judgment actions brought by employees, was identical

to the language of S. 1179 as reported by the Senate Finance

Committee and described in S. Rept. 93-383.   Accordingly, it is

appropriate to look to the Senate Finance Committee’s report on

S. 1179 for an authoritative explanation of section 601(a) of

H.R. 4200, as passed by the Senate.

     On October 2, 1973, the House Committee on Education and

Labor reported H.R. 2, the Employee Benefit Security Act.   H.R. 2

did not include provisions for declaratory judgments.

     On February 5, 1974, the House Committee on Ways and Means

reported H.R. 12481, to provide pension reform.   Section 1041(a)

of H.R. 12481 provided for declaratory judgments as to tax-

qualified status of employee plans.   Proposed section 7476(b)(1)

was identical to what was enacted, except that the bill did not

provide that the Pension Benefit Guaranty Corporation could be a

petitioner.   In H. Rept. 93-779, to accompany H.R. 12481, the

House Ways and Means Committee stated as follows:

     Since the special tax benefits provided by the tax law are
     provided as an incentive to employers to adopt plans which
     provide for broad coverage of employees and protection of
     participants and beneficiaries, these individuals are to be
     treated as interested parties (under regulations prescribed
     by the Secretary or his delegate), and thus may petition the
     Tax Court to declare that the plan as constituted does not
     satisfy the requirements of the tax law designed to protect
     the employees and their beneficiaries as intended by
     Congress. For example, a participant under a plan would be
     entitled to bring an action if he alleges that the vesting
     provisions under the plan do not satisfy the minimum vesting
     requirements of the tax law (sec. 411), and thus the plan is
     not entitled to the tax benefits provided for qualified
     plans unless the plan is amended to satisfy the minimum
                              -34-

     vesting requirements. Similarly, such an action might be
     brought with regard to the antidiscrimination, the
     participation and coverage, or other requirements of current
     law or as added by this bill. [H. Rept. 93-779, 106 (1974),
     1974-3 C.B. 244, 349.]

     H.R. 12855, reported on February 21, 1974, and H. Rept. 93-

807, 1974-3 C.B. (Supp.) 236, are identical on this matter to

H.R. 12481 and H. Rept. 93-779, respectively.    H.R. 12906,

introduced on February 20, 1974, and referred to the House

Education and Labor Committee, 120 Cong. Rec. 3568, did not

include provisions for declaratory judgments.    On February 28,

1974, the House of Representatives agreed to substitute the texts

of H.R. 12906 and H.R. 12855 for the text of H.R. 2, and then

passed H.R. 2., 120 Cong. Rec. 4717, 4756, 4781 (1974).

     As a result of the foregoing, the language of H.R. 2 as

amended and passed by the House of Representatives, insofar as it

related to declaratory judgment actions brought by employees, was

identical to the language of H.R. 12481 and H.R. 12855 as

reported by the House Ways and Means Committee and described in

H. Rept. 93-779 and H. Rept. 93-807, respectively.    Accordingly,

it is appropriate to look to the House Ways and Means Committee’s

reports on H.R. 12481 and H.R. 12855 for an authoritative

explanation of section 1041(a) of H.R. 2, as passed by the House

of Representatives.

     On March 4, 1974, the Senate struck out all after the

enacting clause of H.R. 2 and inserted in lieu thereof the text

of H.R. 4200, as passed on September 19, 1973.
                              -35-

     On August 12, 1974, the conference committee reported H.R. 2

and, in the Joint Explanatory Statement accompanying the reported

legislative language, described the pertinent part of the

declaratory judgment provision as follows, H. Conf. Rept. 93-

1280, 259, 331 (1974), 1974-3 C.B. 415, 492:

     Tax Court declaratory judgment proceedings

          Both the House bill and the Senate amendment provide a
     procedure for obtaining a declaratory judgment with respect
     to the tax-qualified status of an employee benefit plan.
     Under both the House and Senate versions of the bill,
     jurisdiction to issue a declaratory judgment is given to the
     United States Tax Court. This remedy is available only if
     the Internal Revenue Service has issued a determination as
     to the status of the plan which is adverse to the party
     petitioning in the Tax Court, or has failed to issue a
     determination but the petitioner has exhausted his
     administrative remedies inside the Internal Revenue Service.

          The differences between the bill as passed by both the
     House and the Senate are technical in nature. For example,
     the Senate amendment provides that the burden of proof is to
     be on the petitioner (the employer, plan administrator, or
     employee) as to those grounds set forth in the Internal
     Revenue Service determination; the burden of proof is to be
     on the Service as to any other grounds that the Service
     relies upon in the court proceeding (e.g., if the Service
     does not issue a determination as to the plan, then the
     Service is to have the burden of proof as to every ground as
     to which it relies). On the other hand, the House bill does
     not make specific provisions for burden of proof.

          Under the conference agreement, the House provision is
     accepted with a number of amendments. The Pension Benefit
     Guaranty Corporation is permitted to be a petitioner, on the
     same basis as other petitioners. Employees are permitted to
     be petitioners if they qualify as interested parties under
     Treasury regulations and have exhausted their administrative
     remedies. It is contemplated that only those employees who
     are entitled to petition the Secretary of Labor under
     section 3001 of this Act are to be treated as interested
     parties. It is contemplated that the question as to who
     bears the burden of proof will be determined by the Tax
     Court under its existing rule-making authority. Under the
                              -36-

     existing Tax Court rules the taxpayer has the burden of
     proof as to matters in the notice of deficiency. As to
     matters raised by the Service at the time of the Tax Court
     hearing, the Service has the burden. It is expected that
     rules similar to these will be adopted by the Tax Court.

     The legislative language thus described in the Conference

Committee Joint Explanatory Statement was enacted as section 1041

of the Employee Retirement Income Security Act of 1974, Pub. L.

93-406, 88 Stat. 829, 949.
