4
be included in gross income. The Form 1099-R received by
petitioner excluded a proportionate share of petitioner's
investment in the contract. Accordingly, we hold petitioners
underreported their gross income by $26,110 in 1991.
Section 72(t)(1) imposes an additional tax on any amount
received from a qualified retirement plan, including a profit
sharing plan, equal to 10 percent of the portion of such amount
which is includible in gross income. Section 72(t)(2) exempts
distributions from the additional tax if the distributions are
made: (1) To an employee age 59-1/2 or older; (2) to a
beneficiary (or to the estate of the employee) on or after the
death of the employee; (3) on account of disability; (4) as part
of a series of substantially equal periodic payments made for
life; (5) to an employee after separation from service after
attainment of age 55; or (6) as dividends paid with respect to
corporate stock described in section 404(k).
Petitioner received a distribution from a qualified
retirement plan. None of the specifically enumerated exceptions
in section 72(t)(2) apply to exempt the distribution from the
additional tax. Therefore, we conclude petitioners are liable
for the additional tax imposed by section 72(t)(1) on the portion
of the distribution includible in gross income.
Petitioner asserts that the distribution should be exempt
from income tax and/or the additional tax imposed by sections
402(a) and 72. In support of this conclusion, petitioner argues
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