Edward George Shlikas v. Commissioner, T.C. Summary Opinion 2024-10

By using this site, users agree to the Terms of Use on the Welcome page.

U.S. Tax Court

Edward George Shlikas v. Commissioner

T.C. Summary Opinion 2024-10 · Docket 12027-22S · Decided Jun 20, 2024 · Panuthos · T.C. Summary Opinion

Decision for IRS

Source ↗

Addresses I.R.C. § 72

United States Tax Court

T.C. Summary Opinion 2024-10

EDWARD GEORGE SHLIKAS , Petitioner v .

COMMISSIONER OF INTERNAL REVENUE, Respondent ————— Docket N o. 12027-22S . Filed June 20, 2024.

————— Edward George Shlikas , pro se .

Susan A. Bechtel , for respondent.

SUMMARY OPINION

PANUTHOS , Special Trial Judge : This case was heard pursuant to the provisions of section 7463¹ 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.

In a notice of deficiency dated February 28, 2022, respondent determined a def iciency in federal income tax of $13, 702 and a section 6662(a) accuracy-related penalty of $2,740 for taxable year 2019 (year in issue).

Petitioner contends that the imposition of the 10% additional tax on early distributions is arbitrary and capricious as the exceptions under section 72(t)(2) establish arbitrary qualifications. He contends it is arbitrary to allow an exception for using a distribution for higher education expenses per section 72(t) (2)(E) but not for the purchase of a home. He alternatively argues that had he made the distribution just 30 days later in 2020 instead of 2019, he would have qualified for the exception made for distributions under the Coronavirus Aid, Relief, and Economic Security Act , Pub. L. No. 116-136, § 2202, 134 Stat. 281, 340 – 43 (2020).

The Court is a court of limited jurisdiction and lacks general equitable powers. Commissioner v. McCoy , 484 U.S. 3, 7 (1987). There is no authority in the Code or caselaw for an equitable or hardship exception to the imposition of additional tax under section 72(t) on early

Footnotes

¹ Unless otherwise indicated, statutory references are to the Internal Revenue Code, Title 26 U.S.C. (Code) , in effect at all relevant times, and Rule references are to the Tax Court Rules of Practice and Procedure. Served 06/20/24

² Respondent conceded the section 6662(a) accuracy-related penalty of $2,740.

³ Pursuant to section 7491(a), the burden of proof as to factual matters shifts to the Commissioner under certain circumstances. Petitioner has neither alleged that section 7491(a) applies nor established his compliance with its requirements. Therefore, petitioner bears the burden of proof.

⁴ An individual retirement plan is an IRA or an annuity as defined in section 408(a) and (b). See § 7701(a)(37).

⁵ distributions from a retirement account. See Arnold v. Commissioner, 111 T.C. 250, 255 (1998). The record demonstrates that an early distribution was made to petitioner , and he has not demonstrated that an exception applies to the imposition of the 10% additional tax per section 72(t) . Accordingly, we will sustain respondent’s determination. We have considered all arguments, and, to the extent not addressed herein, we conclude that they are moot, irrelevant, or without merit. To reflect the foregoing, Decision will be entered for respondent .

Sections addressed

I.R.C. § 72 Annuities; certain proceeds of endowment and life…
(t) (t)(2) (t)(2)(A) (t)(2)(A)(i) (t)(2)(F) (t)(8)(D)(i)