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Murtaugh from the Union Camp Corporation retirement plan for the
taxable year 1990. We hold that petitioners are required to
include the entire distribution as ordinary income.
(2) Whether petitioners are entitled to an ordinary, rather
than a capital, loss in the amount of $59,700 from the
foreclosure in 1992 of petitioners' two timeshare units in a
resort lodging facility. We hold that petitioners are entitled
to an ordinary loss.
(3) Whether petitioners are liable for additions to tax for
failure to file and for failure to pay estimated tax. We hold
that petitioners are liable for additions to tax to the extent
provided in the opinion.
FINDINGS OF FACT
Some of the facts have been stipulated and are so found. We
incorporate by this reference the stipulation of facts and
attached exhibits. At the time of filing the petition,
petitioners resided in Tuckahoe, New York.
Issue 1. Distribution Under a Qualified Plan
In 1990, petitioner James Murtaugh (petitioner) received a
distribution from his qualified pension plan at Union Camp
Corporation. The gross distribution from the pension plan was in
the amount of $25,313.22, composed of an actual distribution of
$16,203.29, and an amount of $9,109.93 that offset an outstanding
loan principal. Petitioner received the gross distribution
because he ceased employment with Union Camp and his
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