Larry E. and Barbara L. Andra - Page 3

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          is not reviewable by any other court, and this opinion should not           
          be cited as authority.                                                      
               Respondent determined a deficiency of $1,100 in petitioners’           
          Federal income tax for the year 2000.                                       
               At the time the petition was filed, petitioners' legal                 
          residence was Preston, Idaho.                                               
               Petitioners filed a Federal income tax return for the year             
          2000 that showed a tax liability of $5,231, an estimated penalty            
          of $42, and a withholding credit of $777.  Petitioners did not              
          pay the $4,496 balance at the time they filed their return.                 
          During the year 2000, petitioners received an early distribution            
          from an individual retirement account (IRA) in the amount of                
          $4,402.  Petitioners did not include the $4,402 as income on                
          their tax return.  After being contacted by the collection                  
          division of the Internal Revenue Service, petitioners made                  
          arrangements to pay their tax liability in a series of                      
          installments.  Petitioners contend that, in their negotiations              
          for the installment arrangement, it was their understanding that            
          the income tax due on the IRA was included in the total amount              
          they were to pay to the Internal Revenue Service.  The sole                 
          issue, therefore, is whether petitioners paid the $1,100                    
          deficiency, which is the tax due on the IRA distribution they               
          received during the year 2000.  Respondent agrees that, except              
          for the $1,100 attributable to the IRA, the taxes, including                

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