William C. Reichenbach - Page 4

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          distributions.  Respondent also determined that petitioner was              
          liable for additional tax under section 72(t).  After an                    
          adjustment for the standard deduction of a                                  
          married-filing-separate individual, respondent calculated                   
          petitioner's 1993 and 1994 tax liabilities at $37,428 and                   
          $41,918, respectively. Respondent credits petitioner for $11,842            
          and $6,603 in Federal income taxes withheld for 1993 and 1994,              
          respectively, to be applied against the determined deficiencies.            
               As an initial matter, petitioner moved during trial to have            
          his case dismissed for lack of jurisdiction.  He contends that              
          the Court lacks jurisdiction to hear cases involving withholding            
          taxes and that withholding taxes are in issue in this case.  We             
          disagree.  Petitioner failed to file Federal income tax returns             
          and report income.  Petitioner's Federal income tax liabilities             
          are in issue.  Respondent issued a valid notice of deficiency,              
          and petitioner filed a timely petition with the Court.                      
          Consequently, the Court has jurisdiction over this case, and we             
          shall deny petitioner's motion.  See secs. 6212, 6213, and 6214;            
          see also Cross v. Commissioner, 98 T.C. 613, 615 (1992); Pyo v.             
          Commissioner, 83 T.C. 626, 632 (1984).                                      

          capital gain as $73,140, based on petitioner's sale of property             
          at a sale price of $79,900 and a basis of $6,760.  Respondent now           
          concedes that petitioner's basis in the property is $15,500, and            
          that his net capital gain is $64,400.                                       

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