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Held: A fiduciary who reasonably and in good
faith relies on an attorney’s legal advice that there
are no debts due to the United States before paying
other claims has not knowingly disregarded debts of the
United States. P is not liable for the income tax
liabilities of the estate under 31 U.S.C. sec. 3713(b).
Michael M. Sayers, Michael W. Newport, and Brian K. Rull,
for petitioner.
Robert J. Burbank, for respondent.
RUWE, Judge: Respondent determined that petitioner, in his
capacity as a fiduciary of the estate of Jerry J. Calton, is
personally liable under 31 U.S.C. section 3713(b) (1994) for the
estate's unpaid income tax liabilities in the amount of
$63,734.53, plus interest1. The amounts of the unpaid income tax
liabilities of the estate are not in dispute.
Petitioner acknowledges that he permitted all the estate’s
assets to be paid out to creditors and beneficiaries before the
estate's income tax liabilities had been paid. Petitioner
disputes personal liability for these income tax liabilities on
the ground that he did not have knowledge of the estate's unpaid
taxes prior to disbursing the estate's assets.
1The income tax liabilities of the estate are as follows:
Additions to Tax
Year Tax I.R.C. sec. 6651
1989 $4,658.50 $2,071.03
1990 41,080.00 15,815.80
1991 52.00 57.20
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