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OPINION
In their petition, petitioners allege that the deficiency in
this case is based upon respondent’s “determination that
petitioners could not take ordinary losses, in the year of
distribution of all of the proceeds, on stock previously held in
an exempt employees trust.” Petitioners are mistaken on this
point. As noted above, the deficiency in this case is based, in
large part, upon respondent’s determination that the IRA
distributions received by petitioner in 1996 are includable in
petitioners’ income for that year.
Elsewhere in the petition, petitioners allege that during
1996 “the stock was sold at prices below what had been paid for
it by the trust” and that the proceeds of the sale “were
distributed to petitioners and nothing was left in the trust”.
According to the petition, the “aggregate of the proceeds was
less than what had been contributed by the employer into the
trust”. In their brief, petitioners argue that “investment
losses were incurred by the plan” and therefore they “duly
listed, on Schedule D, their investment losses exceeding gains
incurred by the plan in 1996".
The allegations contained in the petition and the argument
presented in petitioners’ brief relate only to whether
petitioners are entitled to a deduction for investment losses
sustained by the plan; none of their allegations or arguments
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Last modified: May 25, 2011