- 4 -
In 2001, Mr. El-Bibany withdrew $48,720 from his retirement
fund.4
Respondent does not dispute that petitioners incurred the
following expenses in 2001:5
Room and board for petitioners’
family collectively
Apartment rent $33,875
Utilities 1,200
Food 7,200
Subtotal $42,275
Health insurance for petitioners’
family collectively
(including health insurance
premiums and health care expenses) $1,800
Transportation for Mrs. Kandil 1,981
Books and supplies for Mrs. Kandil 846
Total $46,902
Petitioners timely filed a Form 1040, U.S. Individual Income
Tax Return, for 2001. On their return, petitioners disclosed the
$48,720 distribution and reported $44,982 as the taxable amount.
Petitioners did not report the 10-percent additional tax imposed
by section 72(t) on line 55 “Tax on qualified plans, including
IRAs, and other tax-favored accounts”, but attached Form 5329,
Additional Taxes on Qualified Plans (Including IRAs) and Other
Tax-Favored Accounts, to their return. On Form 5329, petitioners
4 There is no evidence in the record describing Mr. El-
Bibany’s retirement fund. In respondent’s trial memorandum and
on brief, respondent indicated that this fund was a “qualified
retirement fund with TIAA-CREF”. But see Rule 143(b) regarding
ex parte statements in briefs and the like.
5 Mrs. Kandil received a scholarship that covered her
tuition expense.
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