TAX COURT OPINION

Case: James Anthony Fonteneaux, Sr.
Docket Number: 826-10
Judge: Cohen
Opinion Type: memo
Filed: 02/21/2012
Pages: 6

T.C. Memo. 2012-44 UNITED STATES TAX COURT JAMES ANTHONY FONTENEAUX, SR , PÁtitioner v. COMMISSIONER OF IN ERNAL REVENUE Respondent < Docket No. 126-10 Filéd February 21, 2012. James Anthoñy Fonteneaux, Sr , pro se. Dadid B. 1 I(cid:0)523al foÈrespondent. MEMCRANDUM FIND NGS OF FACT A OPINION COHEN, Judge: Respondent d±termined deficiericies of $15,635 and $2,372 in petitioner's Federal income taxes for 2005 and 2d06, respectively. SE8vED FEB 2 1 2012 - 2 - Respondent also determined additions to tax under sections 6651(a)(1) for each year and a penalty under section 6662(a) for 2005. All section references are to the Internal Revenue Code. Respondent has conceded that petitioner does not owe the deficiency, the addition to tax, or the penalty determined for 2005. The deficiency for 2006 was determined as a section 72 additional tax on premature distributions from retirement plans. The addition to tax for 2006, $152.10, was determined because petitioner's otherwise timely return was unsigned. Petitioner contends that the Internal Revenue Service (IRS) delay in rejecting the unsigned,return prevented timely filing. However, he challenges that only as a consequence of challenging the deficiency for 2006 as resulting from a series of errors and other missteps by respondent's representatives. FINDINGS OF FACT. None of the facts have been stipulated. Petitioner resided in Texas at the time his petition was filed.- On his 2006 Form 1040, U.S. Individual Income Tax Return, he reported pension and annuity income of $106,307, of wh ch $28,789 3 - was taxable. He s bmitted the Form 1040 in April 20d7 ior to the date it was ' due, but did not si n it. The unsigned return was.sent ack to him by the IRS. Petitioner signed the return and sent it back to the IRS, but it was notdiled until November 26, 200 On October 14, 2009, the IRS sent the stätutory i oti e of deficiency to petitioner with respect to 2005 and 2 06, vvith the determinations sét foith above. The petitionswas timely filed with this Court on Januarý 11, 2010. On Mårch 8, 2010, the IRS pren aturelÿ assessed the amounts detern ihed in the statutory notice. Collection otices of intent t levy wëre sent in Jul 2010 The premature assessments were abated in October 2010, whèiYthe pe di g sùit.wäs enteredÝif petitioner's accoun . o In the statutory notice, the amount détermined for 2006 was explained as: Taxlon Quál fiéd Plans er Return Per Exam Adjustmen - $720 $3 092 $2;372 We ad usted your tax by 10 peröê1t dfthe remátùre distribution r iade from your Individual Retiremelit Äccount (IRA). The 10 perce it tax,i~s applicabl unless th'ose funds ai'é páid after ÿou reach 59 ½ or for another allov able reason such as: i Paid on account of death, disability, substantially eqtial payments ov r your (or joint) life expectancies, oi . Certain medical expenses, or . - 4 - First time home purchase, or IRS levy. The $720 item was not reported on or paid with petitioner's Form 1040 and he denies ever paying that:amount. The difference between 10% of the $28 789 . reported:on p,etitioner's Form 1040 and·the $3,092 used in the statutory notice is not explained by evidence;in the record. (It appears froin the arguments of the parties that there is ia dispute about whether $2,130 petitioner received from t Washington Mutual was a distribution from a Roth IRA.) flowever, becáuse the deficiency in dispute is les(cid:0)541than 10% of $28,789, apparently due to an error in petitioner's transcript, the difference does not affect the outcome of this case. OPINION The first time this case was set for trial, in January 2011, the jarties reported a settlement. Respondent prepared decisiori.documents reflecting respolident's concessions of all issues for 2005 and a reduced deficiency;and addition to tax for . 2006. Petitioner repudiated the settlement and sought complete victöry and . sanctions against respondent based on "reckless professional behavior." Petitioner is frustrated by the determination for 200 now óönceded by respondent, by the premature assessment and collectiod activity while this cáse 4 avas pending anSc llection stayed,'b misinformation(cid:16)040,in to him by representatives of respondent and by the délays inhereñt iÁ litigation. Nonetheless, the only issue now to be decided is wheth r t e section 72(t) additional tax on the retirement plan distribution he recéivéd should be sustained in an amount less than the 10% established by statute. Section 72(t (1) impo es an addit onal tax of 10% ori early distributions from qualified retirbment plans, with exceptions listed i s ction 72(t)(2). The exceptions include hose items listed in the statutory no ice quoted above. Petitioner does not rgue that he com s witÏiin any of thê e ceptions. He understands that th amount sought by respondent, $2,3 2 is less than the $2,879 that would be due ón the reported dis ibution if the 10% additional tax were accurately determined. He argues th if he mäde as many istakes during his military career as the IRS and its representatives made in this case, the consequences would be disastrous. believes that the IRS should suffer the consequences of its mistakes and should recover none of thë deficiency for 2006. - 6 - None of the relief petitioner seeks is available in this case. We must apply the law to the established facts. Because respondent has not sought an increasèd deficiency, the amount in.the decision will be less than petitioner would otherwise owe. That is the most compensation that petitioner is entitled to here. Decision will be entered in favor of petitioner for 2005 and in favor of respondent for 2006.