John Michael Dunkin - Page 14

                                       - 14 -                                         
          property law, Poe v. Seaborn, supra, applies, not Lucas v. Earl,            
          supra.                                                                      
          D.   Whether Section 402 or QDRO Rules Govern This Case                     
               Respondent argues that the payments are tax free to                    
          petitioner’s former spouse under section 402(a)10 (and, we                  
          assume, contends inferentially that they are taxable to                     
          petitioner) because the payments were not distributions from her            
          former husband’s pension plan.11  Section 402(a) provides how               
          distributions made from a qualified trust under a qualified                 
          pension plan are taxed.  No distributions from a qualified trust            
          were made in this case.  Thus, contrary to respondent’s argument,           
          by its terms section 402 does not apply to this case.12                     
               We did not discuss section 402 in Eatinger v. Commissioner,            
          T.C. Memo. 1990-310, when we held that the nonemployee spouse was           

               10  Sec. 402(a) provides:                                              
               SEC. 402(a). Taxability of Beneficiary of Exempt Trust.--              
                    Except as otherwise provided in this section, any                 
               amount actually distributed to any distributee by any                  
               employees’ trust described in section 401(a) which is                  
               exempt from tax under section 501(a) shall be taxable                  
               to the distributee, in the taxable year of the                         
               distributee in which distributed, under section 72                     
               (relating to annuities).                                               
               11 Because petitioner’s former spouse is not a party in this           
          case, we do not consider here how she might be taxed on the                 
          payments at issue.                                                          
               12 Respondent does not cite or rely on Karem v.                        
          Commissioner, 100 T.C. 521 (1993).  Unlike the instant case,                
          Karem involved taxation of a distribution from a pension plan.              





Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  15  16  Next

Last modified: May 25, 2011