Best v. Comm'r

T.C. Summary Opinion 2008-160
UNITED STATES TAX COURT
RENITA ROSE BEST, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 6192-07S. Filed December 23, 2008.
Renita Rose Best, pro se.
Michael A. Pesavento, for respondent.
SWIFT, Judge: This case was heard pursuant to the
provisions of section 7463 of the Internal Revenue Code in effect
when the petition was filed. Pursuant to section 7463(b), the
decision to be entered is not reviewable by any other court, and
this opinion shall not be treated as precedent for any other
case.
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Respondent determined a $2,246 deficiency in petitioner’s
Federal income tax for 2004. The only issue for decision is
whether petitioner is liable for a 10-percent $1,971 additional
tax under section 72(t)(1) on an early withdrawal of $19,706 from
her individual retirement account (IRA).
Unless otherwise indicated, all section references are to
the Internal Revenue Code in effect for the year in issue.
Background
Some of the facts have been stipulated and are so found.
During 2004 when petitioner was 53 years old, petitioner
received a $19,706 early distribution from her IRA account at
Wells Fargo Investments L.L.C. Petitioner requested the early
distribution because she had lost her job with a publishing
company and incurred large medical expenses. Eventually,
petitioner lost her home, and she now lives on disability.
On her 2004 Federal income tax return petitioner included
the full $19,706 IRA distribution in income, but petitioner did
not report on her return and did not pay the 10-percent
additional tax generally due under section 72(t)(1) on early
distributions from qualified retirement plans, including IRA
accounts. See secs. 401(a), (k)(1), 408(a), 4974(c)(1), (4);
Dwyer v. Commissioner, 106 T.C. 337, 340 (1996).
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Discussion
Petitioner acknowledges that she does not qualify for any of
the specific exceptions to application of the 10-percent
additional tax under section 72(t)(2)(A)(i), (iii), and (iv),
(F). Petitioner asks us, however, to read into section 72(t) a
financial hardship exception to the 10-percent additional tax and
apply such an exception to her.
We previously have rejected taxpayer requests to read into
section 72(t) an exception to the 10-percent additional tax on
early IRA distributions based on financial hardship. Arnold v.
Commissioner, 111 T.C. 250, 255 (1998); Milner v. Commissioner,
T.C. Memo. 2004-111; Gallagher v. Commissioner, T.C. Memo. 2001-
34.
We conclude that petitioner is liable for the $1,971 10-
percent additional tax on her early $19,706 IRA distribution.
Decision will be entered
for respondent.