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with Magna Carta, the trust, and his father’s death. Respondent
argues that Edgar was aware at the time of filing his 1989 return
that the court had held that the $135,550 belonged to Magna Carta
and that it should be returned. Edgar, who was alienated from
his father and family, was not aware of his father’s holdings or
prior litigation. He believed that the amount received by him
was a nontaxable inheritance from his father. That belief was
based on his father’s deathbed representations and the fact that
Edgar had received the $135,550 from the trust. At the time of
the filing of Edgar’s return, the court’s holding was being
appealed on the theory that the moneys received were
inheritances. Edgar was not involved in pursuing the litigation,
and he was generally unaware of the court’s holdings.
Edgar had no working knowledge of Magna Carta and believed
that the trust was based on his father’s deathbed intent to
permit Edgar to inherit from his father. In addition, Edgar, a
disabled fireman who had no background in these matters, inquired
of his return preparer about whether an inheritance from his
father was taxable. Edgar provided his preparer with information
about the $135,550 based on his understanding. The return
preparer, who was a certified public accountant specializing in
tax and who had prepared Edgar’s returns since 1969, advised that
it was not taxable.
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