Gregory Scott West - Page 5

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          years of age in 1997 when the withdrawal was made.                          
               In a notice of deficiency, respondent determined a                     
          deficiency in the amount of $3,886.  This amount represented a              
          10-percent additional tax on an early IRA distribution pursuant             
          to section 72(t).                                                           
               Under section 408(d)(1), a distribution from an IRA is                 
          taxable to the distributee in the year of distribution in the               
          manner provided under section 72.  Section 408(d)(3) provides an            
          exception to the general rule for certain “rollovers” by the                
          distributee; namely, where a distribution is paid to the                    
          distributee, and the distributee transfers the entire amount of             
          the distribution to an IRA or an individual retirement annuity              
          within 60 days of receipt.                                                  
               Section 72(t)(1) provides for a 10-percent additional tax on           
          distributions from qualified retirement plans.  Section 72(t)(2)            
          excludes qualified retirement plan distributions from the 10-               
          percent additional tax if the distributions are:  (1) Made on or            
          after the date on which the employee attains the age of 59-1/2;1            
          (2) made to a beneficiary (or to the estate of the employee) on             
          or after the death of the employee; (3) attributable to the                 
          employee’s being disabled within the meaning of section 72(m)(7);           
          (4) part of a series of substantially equal periodic payments               

               1    For the purpose of sec. 72(t), the term “employee” also           
          refers to participants in individual retirement accounts.  Sec.             

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