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The CWU retirement plan, which includes the TIAA-CREF
annuity, qualifies as a tax-deferred plan under section
403(b)(1). Accordingly, distributions under the CWU retirement
plan are taxable under section 72.
Respondent contends that the amount received by petitioner
was a death benefits distribution from the TIAA-CREF annuity and
IRD under section 691(a). According to respondent, the $150,000
distribution to petitioner is taxable under section 72 as if
decedent had received such amount. Petitioners and respondent,
of course, disagree on this point, but seem to agree that State
law controls the outcome. Respondent argues that TIAA-CREF
improperly and mistakenly gave effect to the withdrawal request
because decedent had died before the request was received.
Respondent’s argument is based upon the premise that the death of
petitioner’s father in some manner or another voided the
withdrawal request. The manner in which the relevant events
unfolded, however, demonstrates that respondent’s view is
somewhat unique. TIAA-CREF, the personal representative of
decedent’s estate, and the three charities named in the change of
beneficiary apparently do not share respondent’s view.4
4 We note that the three charities that were designated
beneficiaries under decedent’s TIAA-CREF annuity would have been
entitled to share a significantly larger death benefit
distribution under respondent’s position.
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Last modified: May 25, 2011