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The United States Court of Appeals for the Fourth Circuit
(Court of Appeals), in which an appeal in this case would nor-
mally lie, and this Court have addressed the precise issue
presented here. Pfister v. Commissioner, 359 F.3d 352 (4th Cir.
2004), affg. T.C. Memo. 2002-198. In Pfister v. Commissioner,
359 F.3d 352, the taxpayer took substantially the same position
that petitioner takes here. The taxpayer maintained there that
the term “disposable retired pay” used in the divorce decree in
question was calculated after tax was withheld and that therefore
the taxpayer should not be taxed upon the amount of such dispos-
able retired pay to which the taxpayer was entitled under that
divorce decree. In rejecting the taxpayer’s position, the Court
of Appeals stated:
Pfister does not contend that her ex-husband’s military
retirement pay is not a pension; rather, based upon
Pfister’s flawed interpretation of the * * * definition
of “disposable retired pay” Pfister contends that she
is statutorily entitled to her portion of her former
husband’s retirement pay without any tax liability.
Pfister’s argument is without merit.
* * * * * * *
5(...continued)
percent of Mr. Seaman’s post-amendment disposable retired pay,
rather than 50 percent of Mr. Seaman’s pre-amendment disposable
retired pay. Resolution of petitioner’s contention is not
material to our resolution of the issue presented. In any event,
that contention is rejected by the DFAS notice that petitioner
received in the fall of 1992. That notice stated in pertinent
part: “No change is required in the computation of the amount
due the former spouse, taxes are still allowed as a deduction
before dividing the retired pay.”
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