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Petitioner argues that his and Chisum’s testimony
establishes that the trust exists since they both testified that
it exists. Our conclusion is not altered by that testimony
because petitioner’s operation of Arivada shows that it was a
sham.
Petitioner contends that respondent improperly determined
that both Arivada and petitioner had a deficiency based on the
same income. We disagree. The Commissioner may determine as
protective positions that the same income was received by
different taxpayers. See Malat v. Commissioner, 302 F.2d 700,
706 (9th Cir. 1962), affg. 34 T.C. 365 (1960); Doggett v.
Commissioner, 66 T.C. 101, 103 (1976).
5. Conclusion
We do not recognize Arivada as a trust for Federal income
tax purposes. The only purpose for the transfer of property to
the trust was tax avoidance.6 The money paid to it is taxable
income to petitioner. See Rule 142(a).
6 Petitioner testified that he established Arivada to
benefit his disabled child, to protect assets, and to limit his
malpractice liability. Petitioner did not argue on brief that he
had nontax reasons for establishing the trust. We treat this as
petitioner’s abandonment of this contention. See Sundstrand
Corp. v. Commissioner, 96 T.C. 226, 344 (1991); Foil v.
Commissioner, 92 T.C. 376, 409 (1989), affd. 920 F.2d 1196 (5th
Cir. 1990). Petitioner’s testimony about the alleged bona fides
of Arivada was not credible in any event.
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