Vincent A. Suarez, Jr. and Esther Suarez - Page 4

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          the amount of $33,590.  Petitioners did not report, on their 2001           
          return, the additional 10-percent tax imposed by section 72(t)              
          with respect to the $33,590 distribution.                                   
               In the notice of deficiency, respondent determined that                
          petitioners are liable for the 10-percent additional tax on the             
          early distribution from petitioner’s IRA.  Petitioners                      
          acknowledge that the distribution from the IRA does not qualify             
          for any of the exceptions under section 72(t)(2)(A).                        
                                     Discussion                                       
               Section 72(t)(1) imposes an additional tax on early                    
          distribution from qualified retirement plans equal to 10 percent            
          of the portion of such amount which is includable in gross                  
          income.  A qualified retirement plan includes a qualified pension           
          or profit sharing plan under section 401(a).  Sec. 401(a)(1).               
               The section 72(t) additional tax does not apply to certain             
          distributions.  Since petitioners concede that they do not come             
          within any of the exceptions under section 72(t)(2)(A), we                  
          consider whether any other provisions would permit petitioners to           
          be relieved from the 10-percent additional tax.                             
               Section 72(t)(2)(F) provides, in relevant part, an exception           
          to the 10-percent additional tax for distributions to an                    
          individual from an individual retirement plan which are qualified           
          first-time home buyer distributions.  A qualified first-time home           
          buyer distribution is any payment or distribution received by an            






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