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relied on that promise, they suffered no detriment that is
legally cognizable. Petitioners did not surrender any rights.
Petitioners paid the tax that was lawfully owing and did not
change any position to their detriment.
3. Liability for Section 72(t) Additional Tax
Section 72(t) provides:
(1) Imposition of additional tax.–- If any taxpayer
receives any amount from a qualified retirement plan * * *
the taxpayer’s tax under this chapter for the taxable year
in which such amount is received shall be increased by an
amount equal to 10 percent of the portion of such amount
which is includible in gross income.
Section 72(t)(2) provides for exceptions to the additional tax,
which petitioners concede are not applicable here.
Petitioners argue, however, that their case is analogous to
Larotonda v. Commissioner, 89 T.C. 287 (1987), in which this
Court held that where the Commissioner levied on the taxpayer’s
qualified retirement plan, the resulting distribution was not
subject to the 10-percent premature distribution penalty imposed
by then section 72(m)(5). We reasoned that the penalty provision
was meant to discourage voluntary early withdrawals from
qualified retirement plans and to discourage income averaging
which could be achieved by deferring the timing of income until
years with lower annual income amounts. Id. at 292. In deciding
Larotonda we noted that “admittedly, this is a close question”;
however, in light of the involuntary nature of the withdrawal and
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