Hockaden and Associates, Inc. v. Commissioner of Internal Revenue

RALPH B. GUY, Circuit Judge.

Hockaden and Associates, Inc. (Hocka-den or taxpayer) appeals from a United States Tax Court decision, 84 T.C. 13, which determined that it owed substantial excise tax deficiencies. The tax court decision was based upon a finding that unpaid loans made to the taxpayer from an employee profit-sharing plan during the years 1971-1975 resulted in tax liability pursuant to 26 U.S.C. §§ 4975(a) and 4975(b). These sections impose a tax on “prohibited transactions” as defined by § 406(a)(1)(B) of the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. §…