Claudia J. Dunn - Page 3




                                        - 2 -                                         
          Court Rules of Practice and Procedure.                                      
               Respondent determined a deficiency of $4,199 in petitioner’s           
          1998 Federal income tax.  The issue for decision is whether                 
          petitioner is subject to the 10-percent additional tax under                
          section 72(t)(1) on a distribution from a qualified retirement              
          plan.                                                                       
                                     Background                                       
               Petitioner resided in Roseville, California, when the                  
          petition was filed.  Prior to and during the year at issue                  
          petitioner worked as a registered nurse.  At some point during              
          1998, petitioner apparently became convinced from watching                  
          television that, according to a recently enacted law, early                 
          distributions from qualified retirement plans no longer were                
          subject to a 10-percent additional tax if the distributions were            
          used to pay the taxpayer’s qualified higher education expenses.             
          Petitioner telephoned respondent’s assistance number and spoke              
          with a representative.  As a result of her conversation with                
          respondent’s representative, petitioner had the impression that             
          the information she had heard on television was correct.                    
               Before hearing about the new law, petitioner had been                  
          considering continuing her education in order to advance her                
          career as a nurse.  After speaking with respondent’s                        
          representative, petitioner withdrew $41,993 from a qualified                
          retirement plan account at the Lincoln National Life Insurance              






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