- 15 -
We turn now to petitioner's reliance on Larotonda v. Com-
missioner, supra, and Murillo v. Commissioner, supra. We find
those cases to be distinguishable from the present case and
petitioner's reliance on them to be misplaced.
In Larotonda, the Commissioner of Internal Revenue (Com-
missioner) assessed a tax deficiency against the taxpayer and
thereafter levied upon his retirement plan, which was a so-called
KEOGH plan. See Larotonda v. Commissioner, supra at 289. The
Commissioner argued that the taxpayer's gross income included the
levied funds and that the early withdrawal tax imposed by former
section 72(m)(5)(B) applied to those funds. See id. at 290. We
held that although the levied funds were includible in the
taxpayer's gross income, the early withdrawal tax did not apply
with respect to those funds. See id. at 291, 292. We examined
the legislative history behind former section 72(m)(5)(B) and
concluded that "Congress intended to prevent the voluntary, tax-
motivated withdrawal of funds by taxpayers prior to retirement
age." Id. at 292. We found on the record in Larotonda that no
such voluntary, tax-motivated withdrawal of funds occurred, see
id., and that "To the contrary, the funds were withdrawn pursuant
to respondent's levy, an involuntary act, without any active
participation", id., by the taxpayer.
In Murillo v. Commissioner, supra, the taxpayer entered into
a plea agreement as a result of having been indicted for various
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Next
Last modified: May 25, 2011