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salaries, tips, etc.” of $331,916, as reported on the Form W-2.
To arrive at adjusted gross income, petitioners deducted
$211,916; the typed-in explanation on line 32 states only:
“income on which tax paid by employer”. In the notice of
deficiency, respondent disallowed this deduction.
OPINION
Petitioners contend that the 2001 Form W-2 issued by
employer is incorrect in that it does not reflect income taxes
that employer withheld on petitioner’s plan distribution, as
required by the plan’s governing document.1 Accordingly,
petitioners contend that they correctly deducted the amount of
the plan distribution from gross income on their 2001 joint
Federal income tax return.
Petitioners are mistaken. The Code provides no deduction
from gross income for the plan distribution. See secs. 61 and
62. Rather, it is fully includable in gross income, and any
amount withheld as tax would be allowable as a credit pursuant to
section 31. See Goins v. Commissioner, T.C. Memo. 1997-521,
affd. without published opinion 151 F.3d 1029 (4th Cir. 1998).
1 Petitioners contend that pursuant to sec. 6201(d),
respondent bears the burden of producing information to refute
petitioners’ claim that employer withheld Federal income taxes on
the plan distribution. Because our decision in this case does
not turn upon which party bears the burden of production or
proof, we need not address this contention.
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