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however, the taxpayer has a right to access the funds, and does
so in an effort to alleviate his tax liability, or does so in a
manner (such as in Arnold v. Commissioner, supra) that modifies
the series of substantially equal payments under section
72(t)(4)(A) for his personal gain, then that voluntary action
should trigger the recapture penalty under section 74(t)(4)(A).
Based on the foregoing, we reject petitioner’s argument that
the recapture penalty under section 72(t)(4)(A) supersedes the
levy exception provision under section 72(t)(2)(A)(vii). In
doing so, we conclude that respondent’s Appeals Office did not
act in an arbitrary or capricious manner in disregarding
petitioner’s position that a levy upon his IRA account would
result in not only a significant withdrawal from his account, but
an unduly and overly intrusive depletion of most of the account
as a result of the application of the recapture tax.
As to petitioner’s argument that respondent’s Appeals Office
did not consider petitioner’s position that the proposed levy is
unfair in the light of his inability to work and medical
conditions, we are unpersuaded that any issue of fact exists.
Petitioner presented no evidence at the time of the hearing that
he was unable to work. He merely stated that due to a tight job
market in the telecommunications industry he was unable to find
“worthwhile” work. Although petitioner did include mention in
his Explanation (attached to the original OIC) that he had
undergone “two angioplasty procedures”, he offered no additional
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