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a 10-percent tax for premature distribution from a qualified
plan. After concessions by the parties, the issues remaining for
our consideration are: (1) Whether petitioners successfully
rolled over a 1990 plan distribution of $246,647 or whether it
was taxable; (2) if the distribution was taxable, whether it was
subject to the 10-percent additional tax for premature
distribution under section 72(t); (3) whether the distribution is
a lump-sum distribution that meets the requirements for income
averaging under section 402(e); and (4) whether petitioners are
liable for a $19,869 accuracy-related penalty for negligence or
disregard of rules and regulations for failing to report the
pension distribution and other income.
FINDINGS OF FACT
Petitioners resided in San Juan Capistrano, California, at
the time their petition was filed. As of July 18, 1990, each of
petitioners was less than 54 years of age. Winthrop Orgera
(petitioner) was employed as a pilot by Western Air Lines, Inc.
(Western), prior to July 18, 1990. Petitioner participated in
Western's Pilots' Variable Pension Plan (Plan), of which Sumitomo
Bank was the trustee. Petitioner made voluntary contributions to
the fund, and, on July 18, 1990, he received a $246,647.68 cash
distribution from the Plan. The Plan's assets were distributed
2(...continued)
effect for the tax year under consideration. Rule references are
to this Court's Rules of Practice and Procedure.
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Last modified: May 25, 2011