Wallace F. and Mi-Ja H. Smith - Page 10




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          See Crain v. Commissioner, 737 F.2d 1417 (5th Cir. 1984).  In               
          short, petitioners are taxpayers subject to the income tax laws             
          and to the jurisdiction of this Court.  See Abrams v.                       
          Commissioner, 82 T.C. 403, 406-407 (1984).                                  
               On this record, the Court holds that petitioners failed to             
          include in income $45,955 in retirement plan distributions from             
          Berkeley for 1997.  Respondent is, therefore, sustained on this             
          issue.                                                                      
               With respect to the $11,281 IRA distribution from Bank of              
          America to petitioner during 1997, petitioners reported the                 
          distribution on their 1997 return but reported the taxable amount           
          as zero.  Petitioners appear to argue that the distribution                 
          should not be included in income for the year at issue because              
          the liquidation of the IRA constituted an involuntary conversion            
          forced upon them by petitioner's dismissal from employment with             
          Berkeley in that, due to the fact that petitioner was no longer             
          employed after January 1997, petitioners were forced to use                 
          accumulated savings to pay their living expenses, including the             
          subject IRA.                                                                
               In general, any amount paid or distributed out of an                   
          individual retirement account is includable in gross income of              
          the payee or distributee in accordance with section 72.  Sec.               
          408(d)(1); sec. 1.408-4(a)(1), Income Tax Regs; Arnold v.                   
          Commissioner, 111 T.C. 250, 253 (1998).  Section 408(d)(3)                  





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