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3. Arivada’s Tax Returns
Arivada filed Forms 1041, U.S. Fiduciary Income Tax Return,5
for 1993 and 1994. Arivada's 1993 and 1994 tax returns report
that Arivada was a simple trust. Arivada used the Pinnacle Peak
address on its 1993 and 1994 trust returns. Arivada reported
petitioner’s medical income and expenses on its 1993 and 1994
returns.
Arivada attached a Schedule K-1 to its 1993 trust return.
In it, Arivada reported that it had distributed $16,826 (all of
its distributable net income) to a beneficiary named East Point.
Arivada attached two Schedules K-1 to its 1994 trust tax return.
Arivada reported that it had distributed $32,000 (80 percent of
its distributable net income) to East Point, and $8,000 (20
percent of its distributable net income) to an entity called S A
Finance. Arivada provided no employee identification number on
the Schedules K-1 for East Point or S A Finance. Instructions
for Form 1041, Schedule K-1, state:
payers of income are “required under section 6109 to
request and provide a proper identifying number for
each recipient of income. Enter the beneficiary’s
number on the respective Schedule K-1 when you file
Form 1041.”
Arivada filed a petition in bankruptcy on the day the trial
in this case was set to begin.
5 The Form 1041 for 1994 was called U.S. Income Tax Return
for Estates and Trusts.
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Last modified: May 25, 2011