David Brian Nolan - Page 2




                                         -2-                                          
          concessions,2 the issue for decision is whether $3,480 in taxable           
          distributions from petitioners’s individual retirement account              
          (IRA) is subject to the 10-percent additional tax under section             
          72(t).                                                                      
                                  FINDINGS OF FACT                                    
               Petitioner resided in Alexandria, Virginia, when the                   
          petition was filed.                                                         
               Petitioner was born in 1951.  In 2003, he received $21,950             
          in distributions from an IRA.  Petitioner used the proceeds                 
          during 2003 to help pay $18,470 in college expenses on behalf of            
          his sons David and John Nolan and $15,525 in tuition and fees to            
          Randolph-Macon Academy on behalf of a third son, Christopher                
          Nolan.  Christopher was enrolled in the ninth grade at Randolph-            
          Macon Academy, a private high school that prepares students for             
          college and the military.  Christopher is scheduled to receive              
          his high school diploma from Randolph-Macon Academy in 2007.                
               On February 8, 2006, respondent issued petitioner a notice             
          of deficiency for 2003.  Respondent determined that petitioner              
          was liable for additional tax of $2,195 on the early                        
          distributions from his IRA.                                                 



               2Respondent conceded that petitioner is not liable for the             
          10-percent additional tax to the extent of $18,470 used to pay              
          qualified higher education expenses on behalf of petitioner’s               
          children David and John Nolan.  The expenses consisted of:  (1)             
          $15,500 to Mount Olive College; (2) $2,556 to George Mason                  
          University; and (3) $415 to Northern Virginia Community College.            





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