Charlotte Marie Scott - Page 10

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               In the petition to this Court, it is unclear whether                   
          petitioner contended that her distributions were not subject to             
          the 10-percent additional tax because they were used for medical            
          expenses under section 72(t)(2)(B).  However, petitioner                    
          introduced evidence that would suggest that such a claim might be           
          relevant; therefore, we shall discuss this contention.                      
               Section 72(t)(2)(B) provides that the following                        
          distributions are not subject to the additional tax:                        
                    (B) Medical Expenses.--Distributions made to the                  
               employee * * * to the extent such distributions do not                 
               exceed the amount allowable as a deduction under                       
               section 213 to the employee for amounts paid during the                
               taxable year for medical care (determined without                      
               regard to whether the employee itemizes deductions for                 
               such taxable year).                                                    
          The deduction allowed under section 213(a) is for “the expenses             
          paid during the taxable year, * * * for medical care * * * to the           
          extent that such expenses exceed 7.5 percent of adjusted gross              
               On petitioner’s Schedule A, Itemized Deductions,4 petitioner           
          calculated that the total medical and dental expenses paid by her           
          and her husband in 2000 was $3,365.  Petitioner’s 2000 Federal              
          income tax return reflects that her and her husband’s joint                 
          adjusted gross income was $54,340.  Therefore, 7.5 percent of               

          4Petitioner decided against itemizing her deductions and                    
          instead used the standard deduction in her 2000 joint Federal               
          income tax return.  However, petitioner introduced her Schedule             
          A, Itemized Deductions, into evidence in this case.                         

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