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1280, supra, 1974-3 C.B. at 502. Section 1.408-4(b), Income Tax
Regs., describing rollovers from IRA to IRA, uses the language
"if the entire amount received (including the same amount of
money and any other property) is paid into an" IRA.
Based on the language of the statutory provisions and the
legislative histories of those provisions, we hold that
petitioner's use of the distributions from his Keogh and IRA's to
purchase stock which he then contributed to the Smith Barney IRA
does not constitute a tax-free rollover contribution under
section 402(c) or 408(d)(3), respectively.3
Section 6662(a) imposes a penalty of 20 percent of the
underpayment due to negligence or disregard of rules and
regulations. "Negligence" includes any failure to make a
reasonable attempt to comply with the provision of the internal
revenue laws; "disregard" includes any careless, reckless, or
intentional disregard. Sec. 6662(c). The negligence penalty is
inappropriate where an issue to be resolved by the Court is one
3 We note that a limited exception to the requirement of a
tax-free rollover, that the same property distributed be
contributed by the recipient to a qualified plan, was enacted in
1978. See sec. 402(a)(6)(D) (now sec. 402(c)(6)), added by the
Revenue Act of 1978, Pub. L. 95-600, sec. 157(f)(1), 92 Stat.
2763, 2806. This exception permitted property distributed to be
sold and the proceeds contributed during the 60-day period. The
narrow scope of this section is reflected in Staff of Joint Comm.
on Taxation, General Explanation of the Revenue Act of 1978, Pub.
L. 95-600, at 110 (J. Comm. Print 1979). See also Rev. Rul. 87-
77, 1987-2 C.B. 115.
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