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Ed Daniel IV, for petitioners.
Caroline R. Krivacka, for respondent.
OPINION
KROUPA, Judge: Respondent determined a $97,789 deficiency
in petitioners’ Federal income tax for 2002 and determined that
petitioners are liable for the accuracy-related penalty under
section 6662(a)1 for 2002.
There are two issues for decision. The first issue is
whether a $977,888 distribution petitioner Charlotte Gee
(petitioner) received in 2002 from an individual retirement
account (IRA) she maintained only in her name, and which had been
funded in part with a rollover from her deceased husband’s IRA,
is subject to the 10-percent additional tax on early
distributions under section 72(t). We hold that the distribution
is subject to the additional tax under section 72(t).
The second issue is whether petitioners are liable for the
accuracy-related penalty under section 6662(a) for substantial
understatement of income tax. We hold that they are not.
Background
This case was submitted to the Court fully stipulated under
Rule 122.2 The stipulation of facts and the accompanying
1All section references are to the Internal Revenue Code
(Code) in effect for the year at issue, unless otherwise
indicated, and all Rule references are to the Tax Court Rules of
Practice and Procedure.
2We decide this case without regard to the burden-shifting
rule of sec. 7491(a)(1) because the parties stipulated all the
facts in dispute under Rule 122.
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