- 6 - certifying that the policy had been lost or destroyed. In June 2001, petitioner received checks in full settlement of the current cash surrender value of each policy as follows: Date Accumulated Loan PayoffCash Surrender Net Account Paid Cash Value Value Value1 Penalty Distribution2 7142446 Jun 11 $12,434 3$6,429 $6,005 $2,126 $3,879 7142859 Jun 26 10,590 4 8,896 1,694 858 836 7166534 Jun 11 4,700 -0- 4,700 592 53,286 1 Cash value equals accumulated cash value less loan payoff value. 2 Net distribution equals cash value less surrender penalty. 3 On June 14, 1999, College Life sent petitioner a “loan check” of $4,711. Petitioner deposited this check into his wife’s account at First South Credit Union (FSCU). Although petitioner claims that his wife’s account is an annuity account, there is no evidence in the record to support his claim. Rather, based on the documents in the record, it appears that the account is a savings account. 4 On June 7, 1999, College Life sent petitioner a “loan check” of $3,182. Petitioner deposited this check into his wife’s account at FSCU. 5 This computation includes a reduction for Federal income tax withheld of $822. At the time of the distributions, petitioner was under 59-1/2 years of age, he was not disabled, and he had been employed with Memphis City Schools continually since 1980. Americo issued to petitioner three Forms 1099-R, Distributions From Pensions, Annuities, Retirement or Profit- Sharing Plans, IRAs, Insurance Contracts, etc., for 2001 reporting the following amounts as taxable distributions: Account Distribution1 Withholding Code 7142446 $10,308 -0- 2 3 7142859 9,731 -0- 3 7166534 4,107 $822 3 2 1 Distribution amount equals accumulated cash value less surrender penalty. 2 Distribution code 3 is defined as a distribution on account of a disability, which is not subject to the 10-percent additional tax under sec. 72(t)(2)(A)(iii). 3 Distribution code 2 is defined as an early distribution with an applicable exception from the 10-percent additional taxPage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 Next
Last modified: May 25, 2011