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Inc. (TWA). During her employment with TWA, Mrs. Domanico
participated in TWA’s 401(k) plan.
In 1996, Mrs. Domanico terminated her employment with TWA
because of a permanent injury that she incurred on board an
aircraft. Several years later, she continued her studies towards
a permanent teaching certificate. In 2000, Mrs. Domanico began
her graduate studies. She incurred the following higher
education expenses:
Year College Amount
1999 Adelphi & St. John’s
University $6,273
2000 St. John’s University 11,848
2001 St. John’s University 10,357
2002 Teacher Education Institute 517
2003 Teacher Education Institute 3,152
Total $32,147
During 2001, Mrs. Domanico was also employed as a librarian.
TWA informed Mrs. Domanico by letter dated July 25, 2001,
that American Airlines had acquired TWA and that she was
eligible to “roll over” your account balance to another
qualified plan or IRA. You were advised that, once
your TWA-sponsored Plan (the “Plan”) is terminated, you
will be required to: (i) make an election either to
roll over the balances in that plan to the American
Airlines $uper $aver Plan (or other qualified plan if
you take a job with another company that allows such
rollovers); (ii) transfer your balances to an
individual IRA; or (iii) take a direct distribution.
On the basis of her research of the 2001 U.S. Master Tax
Guide (Master Tax Guide), a tax guide published by Commerce
Clearing House, Inc., a private commercial publisher, Mrs.
Domanico decided to take a direct distribution of $40,457 from
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