James E. Copley and Cynthia R. Copley - Page 7

          the tax imposed under section 402(a) or the penalty imposed under           
          section 72(t).  As stated above, the amount simply represents a             
          commission charged by Fidelity and a decline in the market value            
          of the IRA stock.  Consequently, petitioners are not entitled to            
          an adjustment to income in the amount of $1,614.91.                         
          Issue 3.  CSRS Distribution                                                 
               Prior to trial, petitioner stipulated that he received $464            
          from CSRS in 1990 and that he failed to report this distribution            
          as taxable income.  At trial, petitioner attempted to withdraw              
          this stipulation and argued that he did not receive $464 but,               
          instead, received $104.95 of nontaxable income.  In support of              
          his position, petitioner presented a statement from the Office of           
          Personnel Management (OPM) stating that petitioner's application            
          for refund of retirement deductions had been approved, and that a           
          check for $104.95 would be issued.  The statement indicated that            
          the refund, consisting entirely of funds petitioner had put into            
          the Civil Service Retirement and Disability Fund, was nontaxable.           
               Respondent does not dispute that the $104.95 is exempt from            
          tax.  An Examination/Information Return Master File Transcript              
          For Tax Year 1990 (the transcript), which lists payee entities,             
          payer entities, information forms received (e.g., Form 1099), and           
          types and amounts of income, indicates that petitioner received a           
          gross distribution of $464 of taxable income from CSRS during               
          1990.  Although respondent did not present the Form 1099-R in               
          question, the absence of that document appears due to the fact              

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