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record. Petitioner has not worked at the U.S. Postal Service
since her brief return in June 1998, but she continues to receive
workers’ compensation payments from the OWCP. She has not seen a
therapist since early 2000 or 2001. She has been given various
medications over the years and “still [takes] some every now and
then.”
At some point in time petitioner received a loan from the
Federal Employees’ Thrift Savings Plan (TSP). This loan was not
repaid or reamortized by the required deadline. Consequently,
the TSP National Finance Center declared that petitioner had a
taxable distribution from the plan on July 12, 1999, of $5,181,
the amount of unpaid principal and interest as of that date.
Petitioner filed a Federal income tax return for taxable
year 1999, on which she included in her income the TSP
distribution at issue. She did not report liability for an
additional tax under section 72(t). In the statutory notice of
deficiency, the sole adjustment was respondent’s determination
that petitioner was liable for such an additional tax in the
amount of $510.1
Generally, section 72(t)(1) imposes a 10-percent additional
tax on early distributions from qualified retirement plans,
unless the distribution comes within one of several statutory
1Although 10 percent of the distribution equals $518,
respondent does not seek an increased deficiency.
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Last modified: May 25, 2011