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account at Washington Mutual Bank (Washington Mutual).
Petitioners received monthly statements from Washington Mutual
showing that interest earnings were credited to their savings
account. Petitioners received from Washington Mutual a Form
1099-INT, Interest Income, reporting that their savings account
earned a total of $304 in interest during 2000. Petitioners
could withdraw funds from their savings account, including
interest earnings, without any restrictions. Petitioners,
however, did not withdraw any of the interest credited to this
account.
Petitioners also maintained several certificates of deposit
at Banner Bank (CD accounts) during the year in issue.
Petitioners received monthly statements from Banner Bank showing
that interest was credited to their respective CD accounts.
Collectively, petitioners’ CD accounts earned a total of $7,530
in interest during 2000.6 Petitioners could withdraw the
interest on demand, but there may have been a penalty for early
6 In the notice of deficiency, the entry for Banner Bank
listed that petitioners’ “Account No. 20-411068-13” earned $8,606
in interest. The parties stipulated, however, that petitioners’
CD accounts, collectively, were credited with a total of $7,530
in interest and that Account No. 20-411068-13 was credited with
only $771 in interest. The record does not explain why the
notice of deficiency lists only Account No. 20-411068-13, but
this appears to be a source of petitioners’ acrimony towards
respondent. We further note that the bank records in evidence
show that petitioners’ CD accounts, collectively, were credited
with $7,545 in interest, which discrepancy is unexplained in the
record.
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Last modified: May 25, 2011