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(1929); see Poczatek v. Commissioner, 71 T.C. 371, 378 (1978).
We note that had petitioner voluntarily assigned his interest in
the IRA to his former spouse in connection with the debt that he
owed to her, the assignment would be deemed a distribution. Sec.
1.408-4(a)(2), Income Tax Regs. Furthermore, a taxpayer cannot
avoid the Federal income tax consequences resulting from a
particular transaction by transferring the proceeds of the
transaction to a creditor in satisfaction of a debt. As noted by
the Supreme Court in Helvering v. Horst, 311 U.S. 112, 116
(1940):
If the taxpayer procures payment directly to his
creditors of the items of interest or earnings due him,
* * * [citations omitted] he does not escape taxation
because he did not actually receive the money.
We understand that unlike the transfer involved in
Helvering v. Horst, supra, or contemplated by the above
regulation, the transfer in this case was hardly "voluntary";
however, we attach no significance to such a distinction. We
consider the transfer to petitioner's spouse to constitute a
distribution to petitioner.
Distributions from an IRA are includable in income in
accordance with section 72. Sec. 408(d). The distribution was
not received by petitioner as an annuity; consequently, the
provisions of section 72(e) are applicable. Consistent with the
presumption of correctness applicable to respondent's
determination, Welch v. Helvering, 290 U.S. 111, 115 (1933), and
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