- 2 -
Respondent determined deficiencies in petitioner's 1993 and
1994 Federal income taxes in the amounts of $3,370 and $1,196,
respectively. The issue for decision is whether certain
miscellaneous itemized deductions attributable to a grantor trust
are subject to section 67(a).
FINDINGS OF FACT
Some of the facts have been stipulated and are so found.
Petitioner filed timely 1993 and 1994 Federal income tax returns.
She resided in Omaha, Nebraska, at the time the petition was
filed.
Petitioner is a grantor and beneficiary of the Jay Newlin
Trust (the trust). The trust was created on December 11, 1976,
in order to preserve financial security for the grantors, more
efficiently manage their investments, and gain financial
advantages for the beneficiaries. Although certain restrictions
apply to distributions of corpus, for Federal income tax
purposes, the trust is what is commonly referred to as a grantor
trust. See generally sections 671 through 679.
During the years at issue, the trust corpus was valued at
approximately $200 million, of which petitioner's interest was
approximately 2.9 percent. The trust was administered by three
trustees, none of whom had any expertise in the management of a
large investment portfolio. In order to assist them in making
financial and other investment decisions, the trustees retained
Page: Previous 1 2 3 4 5 6 7 8 Next
Last modified: May 25, 2011