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the portion of such amount that is includable in gross income.
Section 72(t)(2) exempts distributions from the additional tax if
the distributions are made, inter alia, (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).
None of the specifically enumerated exceptions in section
72(t)(2) applies to the distribution, and we have held that a
portion of the distribution must be included in petitioner's
gross income. Accordingly, petitioners are liable for the
additional tax imposed by section 72(t)(1) on the portion of the
distribution includable in gross income as determined by
respondent.
Accuracy-related Negligence Penalty
In the notice of deficiency respondent determined that
petitioners are liable for an accuracy-related penalty for
negligence or disregard of the rules or regulations. Section
6662(a) and (b)(1) impose an accuracy-related penalty equal to 20
percent of the portion of the underpayment of income tax that is
attributable to negligence. Negligence includes the failure to
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