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the marital home is paid, or the marital home is sold, or
foreclosed upon by the mortgage holder.
During 1997, petitioner received the court-ordered payments
directly from the U.S. Coast Guard.1 Petitioner filed timely a
Federal income tax return for 1997 that did not report as income
the receipt of the payments she received under the decree.
On January 21, 2000, the Internal Revenue Service (IRS)
received an amended tax return from petitioner reporting total
pensions and annuities of $6,563 but showing the taxable amount
as zero.
Discussion
Respondent determined in the statutory notice of deficiency
that petitioner must include in income the payments received from
the U.S. Cost Guard as a result of the decree. Respondent argues
that what petitioner got under the decree "is simply a right to
receive a future stream of income".
Under the law of Oregon, the court may issue a decree of
marital dissolution which provides for the division, or other
disposition between the parties, of their real or personal
property "as may be just and proper". Or. Rev. Stat. sec.
107.105(f)(1999), added to Or. Rev. Stat. in 1983; see Richardson
1By Federal statute, the payments end in accordance with the
court order but not later than the date of death of the retiree
or the former spouse to whom payments are being made. See 10
U.S.C. sec. 1408(d)(4) (1994).
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