                          T.C. Memo. 1998-321



                        UNITED STATES TAX COURT



                  ROBERT J. HOAGLUND, Petitioner v.
            COMMISSIONER OF INTERNAL REVENUE, Respondent



       Docket No. 18418-97.                Filed September 9, 1998.



       Robert J. Hoaglund, pro se.

       Margaret C. Tinagero, for respondent.



                          MEMORANDUM OPINION


       JACOBS, Judge:   This case is presently before the Court on

respondent's Motion For Judgment On The Pleadings pursuant to Rule

120.
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     Respondent determined a $10,995 deficiency in petitioner's

Federal income tax for 1994, and a $2,199 accuracy-related penalty

pursuant to section 6662.

     Unless indicated otherwise, all section references are to the

Internal   Revenue   Code   for   the   year   in   issue,   and   all   Rule

references are to the Tax Court Rules of Practice and Procedure.

     On July 14, 1998, respondent filed a Motion For Judgment On

The Pleadings pursuant to Rule 120, claiming that the undisputed

facts in the pleadings require judgment in favor of respondent as

a matter of law.     On August 17, 1998, petitioner filed a Response

To Respondent's Motion For Judgment On The Pleadings.

     The sole issue for decision is whether an order of the U.S.

Bankruptcy Court for the Central District of California discharged

petitioner's debt to respondent for the 10-percent additional tax

pursuant to section 72(t) on premature distributions from an

individual retirement account (IRA).

     The facts set forth below are derived from the pleadings filed

by the parties.

Background

     At the time the petition was filed, petitioner resided in

Thousand Oaks, California.

     By a notice of deficiency dated July 7, 1997, respondent

determined various increases in petitioner's Federal income tax for

1994, including a 10-percent additional tax pursuant to section
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72(t) for premature distributions from an IRA.    In a petition to

this Court filed on September 8, 1997, petitioner disputed only

respondent's attempt to collect the additional tax for premature

distributions, asserting that such debt was discharged by order of

the bankruptcy court, effective July 30, 1996.

     Attached to the petition filed by petitioner was a copy of the

bankruptcy court's discharge order.       The order indicates that

petitioner filed a petition with the bankruptcy court on April 24,

1996, pursuant to chapter 7 of the Bankruptcy Code (11 U.S.C.).

The order further provides that no complaint objecting to the

discharge of petitioner's debt was filed, or in the alternative

that if one was filed, it was not sustained.     Consequently, the

bankruptcy court ordered the following:

     1.   The above-named debtor [petitioner] is released from
     all dischargeable debts, except those pending complaints
     which will be determined later.

     2.   Any judgment heretofore or hereafter obtained in any
     court other than this court is null and void as a
     determination of the personal liability of the debtor
     [petitioner] with respect to any of the following:

          (a) debts dischargeable under 11 U.S.C. Section 523;

          (b) unless heretofore or hereafter determined by
     order of this court to be nondischargeable, debts alleged
     to be excepted from discharge under clauses (2), (4) and
     (6) of 11 U.S.C. Section 523(a);

          (c) debts determined by this court to be discharged.

     3.   All creditors whose debts are discharged by this
     order and all creditors whose judgments are declared null
     and void by paragraph 2 above are enjoined from
     instituting or continuing any action or employing any
                                      - 4 -


     process or engaging in any act to collect such debts as
     personal liabilities of the above-named debtor.

The order of discharge was entered on July 30, 1996.

     In   answer   to    petitioner's     petition,       respondent   generally

denied    petitioner's       allegation   that    the    bankruptcy    court   had

discharged petitioner's debt for the additional tax on premature

distributions.     In reply to that answer, petitioner asserted that

respondent failed to object to the discharge of petitioner's debts

after    notice   by   the    U.S.   Trustee     assigned   to   the   case,   and

petitioner argued that the doctrines of res judicata and collateral

estoppel prohibited respondent from attempting to collect the

additional tax on premature distributions.

Discussion

     Rule 120 provides that after the pleadings in a case are

closed but within such time as not to delay the trial, a party may

move for judgment on the pleadings.            The granting of a motion for

judgment on the pleadings is proper only where the pleadings do not

raise a genuine issue of material fact and the moving party is

entitled to judgment as a matter of law.                Abrams v. Commissioner,

82 T.C. 403, 408 (1984); Anthony v. Commissioner, 66 T.C. 367

(1976), affd. without published opinion 566 F.2d 1168 (3d Cir.

1977).     We find that no genuine issue of material fact is in

dispute herein.

     Respondent is not herein entitled to judgment as a matter of

law because we do not have jurisdiction to address the issue raised
                                 - 5 -


by respondent's motion for the reason explained below.           However,

because no justiciable issue is raised in the petition, we shall

on our own initiative dismiss petitioner's case for failure to

state a claim on which relief can be granted.

     Respondent argues that "It is a legally [sic] impossibility

for the amounts at issue to have been discharged in the bankruptcy

case."   Respondent reaches this conclusion through a reading of 11

U.S.C.   sec.    523   (1994)   which    provides   exceptions   to   the

dischargeability of debts under the Bankruptcy Code, including

chapter 7 petitions. Respondent directs us specifically to section

523(a)(1)(A) and (a)(7) of the Bankruptcy Code which identifies the

type of taxes that are nondischargeable.      Section 523(a) provides,

in part, as follows:

     SEC. 523.    EXCEPTIONS TO DISCHARGE.

     (a) A discharge under section 727, 1141, 1228(a),
     1228(b), or 1328(b) of this title does not discharge an
     individual debtor from any debt--

           (1)   for a tax or customs duty--

                 (A) of the kind and for the periods
                 specified in section 507(a)(2) or
                 507(a)(8)[1] of this title, whether
                 or not a claim for such tax was
                 filed or allowed; * * *


     1
          Sec. 507(a) of the Bankruptcy Code sets forth a
priority listing for the payment of expenses and claims against a
debtor's estate. Sec. 507(a)(8) of the Bankruptcy Code provides
a priority for unsecured claims of governmental units for taxes
measured by income or gross receipts within the time periods set
forth therein.
                                    - 6 -


         *       *        *         *         *        *        *

             (7) to the extent such debt is for a fine,
             penalty, or forfeiture payable and for the
             benefit of a governmental unit, and is not
             compensation for actual pecuniary loss, other
             than a tax penalty--

                  (A) relating to a tax of a kind not
                  specified in paragraph (1) of this
                  subsection; or

                 (B) imposed with respect to a
                 transaction or event that occurred
                 before three years before the date
                 of the filing of the petition; * * *


Respondent asserts that the additional tax under section 72(t)

falls within the confines of these exceptions and therefore is

nondischargeable by the bankruptcy court.

     Petitioner argues, in essence, that the additional tax under

section 72(t) is a tax penalty rather than an income tax, and that

the penalty is a dischargeable debt. Petitioner further reiterates

his position in the petition and reply to respondent's answer that

the bankruptcy court has already resolved this issue through its

order.   Alternatively, petitioner asks us to remand the issue back

to the bankruptcy court for resolution.

     The     parties   apparently       request   us   to   determine   the

characterization of the deficiency arising under section 72(t) for

purposes of determining its dischargeability.          In this regard, we

note the existence of various tests for analyzing the proper

characterization of items as taxes for purposes of priority under
                                       - 7 -


the Bankruptcy Code.       See, e.g., City of New York v. Feiring, 313

U.S. 283 (1941); In re Cassidy, 983 F.2d 161 (10th Cir. 1992)2; In

re Lorber Indus. of Cal., Inc., 675 F.2d 1062 (9th Cir. 1982).

     The Tax Court is a court of limited jurisdiction conferred by

statute.    Sec. 7442; Commissioner v. Gooch Milling & Elevator Co.,

320 U.S. 418 (1943); Naftel v. Commissioner, 85 T.C. 527, 529

(1985).    As such, our jurisdiction does not extend to deciding

whether    a    deficiency     was    discharged      in    a     prior   bankruptcy

proceeding. Neilson v. Commissioner, 94 T.C. 1, 8-9 (1990); Graham

v. Commissioner, 75 T.C. 389, 399 (1980).                       "In exercising our

jurisdiction       to    redetermine        deficiencies,         we   are   without

jurisdiction to 'allow or disallow a claim against a debtor's

estate * * * or to discharge taxes as a bankruptcy court might.'"

Neilson v. Commissioner, supra at 9 (quoting Fotochrome, Inc. v.

Commissioner, 57 T.C. 842, 847 (1972)).                     Consequently, we are

unable to address the proper characterization of the deficiency

arising    under    section    72(t)       for   purposes    of    determining     its

dischargeability under the Bankruptcy Code. This issue is properly

resolved by the bankruptcy court, not the Tax Court.                      Therefore,

respondent's motion will be denied.               However, because petitioner

does not       dispute   any   of    the    underlying     deficiencies      nor   the

     2
          Interestingly, the Court of Appeals for the Tenth
Circuit in In re Cassidy, 983 F.2d 161 (10th Cir. 1992), held
that the 10-percent additional tax under sec. 72(t) was
characterized as a nonpecuniary loss penalty rather than a tax
for purposes of priority under the Bankruptcy Code.
                                 - 8 -


accuracy-related penalty determined by respondent in the notice of

deficiency, and because there is no justiciable issue before us, we

shall dismiss petitioner's case for failure to state a claim on

which relief can be granted.

     To reflect the foregoing,



                                     An order denying respondent's

                                 motion will be issued; an order of

                                 dismissal and decision in favor of

                                 respondent will be entered.
