- 12 -- 12 -
the wrong year in which to tax petitioners on the $174,308
withdrawn from CCMI and deposited into the offshore trusts.
Respondent argues that the $184,630 that in June of 1983
petitioners withdrew from the Alpha account and used to purchase
the Oyster Pond Property should be treated as a constructive
dividend taxable to petitioners in 1983.
We agree with respondent. In the instant case, during 1982
and early 1983, sufficient control over the offshore trust bank
accounts was maintained and exercised on behalf of CCMI so that
the funds transferred by CCMI in 1982 through the trusts and into
the Alpha account are to be treated as properly taxable to
petitioners in 1983, the year in which CCMI's funds were first
used by petitioners for petitioners' personal benefit.
During June of 1983, before petitioners withdrew the
$184,630 from the Alpha account, $135,000 of the funds in that
account was transferred to CCMI, and then from CCMI through the
offshore trusts, back to the Alpha account. Interest of $3,158
that was earned on the Alpha account in 1983 was reported on
CCMI's 1983 corporate Federal income tax return. From the
inception of the Alpha account, CCMI's taxpayer identification
number was used for the Alpha account. Lastly, petitioners made
no personal use of the funds in the Alpha account until June 24,
1983, when $184,630 was withdrawn from the account for purchase
by petitioners of the Oyster Pond Property.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Next
Last modified: May 25, 2011