- 14 -
The 10-percent additional tax, however, does not apply to
certain distributions. Section 72(t)(2) sets forth specific
exceptions. Those exceptions include, but are not limited to,
distributions made on or after the date on which the employee
attains age 59-1/2; distributions made to the employee to the
extent such distributions do not exceed amounts paid for medical
care; distributions to unemployed individuals for health
insurance premiums; and distributions from certain plans for
first home purchases. Sec. 72(t)(2)(A)(i), 72(t)(2)(A)(v),
72(t)(2)(B), 72(t)(2)(D), 72(t)(2)(F).
Petitioner seeks relief from the 10-percent additional tax
on his IRA distribution based on hardship, medical expenses,
payment of health insurance premiums, and a first home purchase.
There is no exception under section 72(t) for financial hardship.
See Arnold v. Commissioner, 111 T.C. 250, 255 (1998); Gallagher
v. Commissioner, T.C. Memo. 2001-34; Deal v. Commissioner, T.C.
Memo. 1999-352.
Petitioner argues that he falls within the exception for
distributions made for medical expenses under section 72(t)(2)(B)
because he was responsible for the health expenses of his minor
dependent and spouse during his period of unemployment. No
medical expenses were claimed on petitioner’s Form 1040, and he
did not file jointly with his spouse. Petitioner testified that,
though there were medical and dental expenses, he could not “lay
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Next
Last modified: May 25, 2011