Verl W. and Frances M. Haderlie - Page 11

                                       - 11 -                                         

          anticipated that their involvement would subject them to a tax              
          burden or possible financial hardship.  Their actions, however,             
          are well documented, and the tax burden that results in these               
          circumstances has been considered, analyzed, and explained by               
          this and other courts.  Petitioner signed an illusory document              
          reciting that a nonrecourse loan existed in the event that the              
          Internal Revenue Service looked into their insurance transaction.           
          Under these circumstances we do not see petitioner as an                    
          unwitting participant.  We also note that petitioners became                
          involved with Schwab in a subsequent and similar insurance                  
          coverage scheme.  In the subsequent transaction, petitioner had             
          become leery, refusing to sign any documents or to remit checks             
          to the insurance company in exchange for a check from Schwab.  In           
          the subsequent transaction, Schwab paid the insurance company,              
          and petitioner applied for the insurance and was subjected to a             
          physical exam in order to be entitled to the insurance coverage.            
          In either situation, petitioner had to apply for insurance, take            
          a physical exam, and manifest to the insurer his intent to apply            
          for insurance.  In exchange for those actions or consideration,             
          petitioners received the benefit of $1,250,000 of insurance                 
          coverage, which was ultimately paid for by the agent, Schwab.               
               To reflect the foregoing,                                              
                                             Decision will be entered for             

Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  

Last modified: May 25, 2011