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FINDINGS OF FACT
In January 1963, petitioners were married in Cuba. In
October 2003, petitioner Carlos Menendez closed his individual
retirement account (IRA) and received $35,407. Mr. Menendez was
the only person authorized to request distributions from the IRA,
and the funds were deposited into a checking account over which
he had sole control.
On February 16, 2004, in preparation for petitioners’
divorce, petitioner Maria Menendez signed an asset inventory list
(the inventory list) prepared by their financial adviser that
listed all the assets of Mr. and Ms. Menendez. The inventory
list delineated eight retirement accounts, including Mr.
Menendez’s IRA showing a balance of “None”. The inventory list
signed by Ms. Menendez was based on their financial adviser’s
records as of January 8, 2004.
On March 19, 2004, petitioners’ marriage was dissolved. On
October 12, 2004, petitioners jointly filed their Form 1040, U.S.
Individual Income Tax Return, relating to 2003. In preparation
for their joint 2003 return, petitioners individually provided
tax information in their possession to their accountant. The
proceeds from the IRA were not reported on the 2003 return.
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the Internal Revenue Code in effect for the year in issue.
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Last modified: November 10, 2007