J. Kelly and Martha L. Anderson - Page 3




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          account to secure a higher interest rate.1  On the withdrawal               
          form, Mr. Anderson checked the box for normal distribution but              
          handwrote “rollover” in the same section.  Upon receipt of the              
          check, Mr. Anderson went to Northwest National Bank of Arlington            
          (Arlington) and stated that he wanted to open an account with his           
          IRA check.2  The new accounts representative at Arlington advised           
          Mr. Anderson that he might want to open up two accounts, one for            
          himself and one for his wife, in order to maximize the insurance            
          coverage of the Federal Deposit Insurance Corporation (FDIC) on             
          their accounts.3  With the proceeds of his IRA check, Mr.                   
          Anderson purchased from Arlington a 1-year, $100,000 Certificate            



               1 Each year, Mr. Anderson had withdrawn the income earned on           
          the account.  The record does not explain the $17,158.86                    
          difference between the deposited funds and the withdrawn balance.           
               2 Although petitioners testified summarily that they                   
          specifically asked the representative to open an IRA account for            
          them, we find this testimony unbelievable in light of the record            
          as a whole.  We decline to rely on that naked, self-serving                 
          testimony for the purpose of reaching our decision herein.  See             
          Commissioner v. Duberstein, 363 U.S. 278, 291 (1960); Casperone             
          v. Landmark Oil & Gas Corp., 819 F.2d 112, 115 (5th Cir. 1987);             
          Diamond Bros. Co. v. Commissioner, 322 F.2d 725, 731 (3d Cir.               
          1963), affg. T.C. Memo. 1962-132.  Petitioners could have, but              
          did not, call as a witness the representative of the bank to                
          testify as to her memory of the conversation.  (Mrs. Anderson               
          testified that the bank president disputed petitioners’ claim               
          that the bank had erroneously not opened an IRA account.)  We               
          also note, as described infra, that Mr. Andersen is a college-              
          educated man who we believe would have noticed that the                     
          application opening the account was not in the name of an IRA nor           
          was creating a trust account.                                               
               3 The representative advised Mr. Anderson that the FDIC                
          insured each account of a depositor up to a maximum of $100,000.            





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