Michael G. Bunney - Page 10

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          in a retirement plan is taxed one-half to each spouse except                
          where Congress has specified otherwise; e.g., in sections                   
          219(f)(2), 402(e)(4)(G), and 408(g).  In Karem v. Commissioner,             
          100 T.C. 521, 529 (1993), we held that a pension distribution               
          subject to section 402(e)(4)(G) was taxable entirely to the                 
          participant even though his former spouse was considered a one-             
          half owner under State community property law.  Unlike the                  
          taxpayer in Powell, the taxpayer in Karem had elected the multi-            
          year averaging method then available under former section 402(e)            
          for computing the tax due on lump-sum distributions.  As a                  
          result, the distributions were subject to former section                    
          402(e)(4)(G), which provided that “the provisions of this                   
          subsection * * * shall be applied without regard to community               
          property laws.”  Consistent with these opinions, we hold that               
          section 402(g) precludes taxation of petitioner’s former spouse             
          as a distributee in recognition of her State community property             
          interest in petitioner’s IRA’s.  Accordingly, the distributions             
          from petitioner’s IRA’s are wholly taxable to petitioner.                   
               B.   Nonrecognition Under Section 408(d)(6)                            
               Petitioner alternatively contends that the distribution and            
          transfer of his IRA proceeds pursuant to the dissolution judgment           

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