E. Joan Birkey & Larry E. Birkey, Petitioners

T .C . Summary Opinion 2007-72

STAT .

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UNITED STATES TAX COUR T

E . JOAN BIRKEY AND LARRY E . BIRKEY, Petitioners v . COMMISSIONER OF INTERNAL REVENUE, Responden t Docket No . 6392-05S .

Filed May 9, 2007 .

E . Joan Birkey and Larry E . Birkey, pro sese .

Catherine Tyson, for respondent .

FOLEY, Judge : This case was heard pursuant to section 74631 of the Internal Revenue Code . 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 . The issue for decision is whether petitioners failed t o ' Unless otherwise indicated, all section references are to the Internal Revenue Code in effect for the year in issue .

5EBYER MAY 9 1 2007 report income relating to 2002 .

Background In 2002, petitioners received interest income from three banks . In addition, on December 6, 2002, Ms . Birkey received $40,433 from her Keogh account (i .e ., a qualified retirement plan for self-employed individuals) . On that same day, Ms . Birkey used those funds to purchase U .S . Savings Bonds . Petitioners, on their 2002 joint Federal income tax return, did not include in gross income the interest income and the distribution from the Keogh account .

On January 24, 2005, respondent sent petitioners a notice of deficiency relating to 2002 . Respondent determined that petitioners failed to report the interest income and the distribution from the Keogh account . On April 5, 2005, petitioners, while residing in Osage Beach, Missouri, filed their petition with the Court .

Discussion Pursuant to section 61(a)(4), interest income is included i n gross income . Pursuant to section 72, amounts distributed from a Keogh account are included in gross income in the year of receipt . See sec . 402(a) . Petitioners contend that purchasing U .S . Savings Bonds with the distribution from the Keogh account is a "qualified rollover" (i .e ., the distribution would not be includable in their gross income) . No such exception exists .

Sec . 402(c)(1) ; Lemishow v . Commissioner , 110 T .C . 110, 112 (1998) . Accordingly, respondent's determinations are sustained .2 Contentions we have not addressed are irrelevant, moot, or meritless .

To reflect the foregoing, Decision will be entere d for respondent .

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