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for 1994, and accuracy-related penalties under section 6662(a)
for negligence of $4,859 for 1993 and $5,578 for 1994.
In 1993, petitioner transferred his residence and medical
practice to the Arivada Health Enterprises Trust (Arivada).
Respondent determined that Arivada is a sham and lacks economic
substance.
On October 19, 1998, petitioner filed a petition in the U.S.
Bankruptcy Court for the District of Arizona. On October 20,
1998, respondent filed a motion to lift the automatic stay of Tax
Court proceedings under 11 U.S.C. sec. 362(a)(8) (1994). On
October 21, 1998, the bankruptcy court lifted the stay.
The issues for decision are:
1. Whether we have jurisdiction to decide this case after
the bankruptcy court lifted the stay on proceedings in the Tax
Court. We hold that we do.
2. Whether income received by the trust in the amount of
$58,989 in 1993 and $78,772 in 19942 is included in petitioner's
income. We hold that it is.
3. Whether petitioner is subject to self-employment tax on
income in the amount of $58,989 in 1993 and $78,772 in 1994 which
he diverted to Arivada. We hold that he is.
2 Respondent determined that petitioner failed to report in
income $62,989 for 1993, but now concedes that petitioner
reported $4,000 of this income for 1993.
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