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After a concession by respondent,2 the issues for decision are:
(1) To what extent are petitioners taxable on withdrawals from
an Individual Retirement Account (IRA) during 1992; and (2)
whether petitioners are liable for the additional tax under
section 72(t). The facts stipulated by the parties in the
stipulation of facts and the supplemental stipulation of facts
are incorporated herein by reference. Petitioners resided in
Eagle Rock, California, at the time their petition was filed with
the Court.
During the years 1985 through 1992, petitioner Ronny H.
Schmalzer (petitioner) was employed in the lithography business
by various employers. Several of petitioner’s employers during
this period had pension plans in which petitioner may have been
eligible to participate or in which he did participate.
On November 29, 1985, petitioner established an IRA with the
purchase of a variable rate certificate at California Federal
Savings and Loan. The record title for the certificate was
“California Federal Savings and Loan as Trustee for Ronny H.
Schmalzer Under the IRA League Retirement Plan”. The initial
deposit for this certificate was $1,000.3 Subsequently from time
2 Respondent conceded that the petitioners are entitled to
the mortgage interest deduction claimed on their return.
3 Although the certificate shows the initial maturity date
to be May 28, 1985, we believe the date should have been May 28,
1987, as the renewal term for the certificate was 1-1/2 years.
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