James F. McGuirl - Page 4




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               On August 4, 1995, the trustee of the bankruptcy estate                
          filed a proposed final account with the bankruptcy court.  On               
          August 7, 1995, the trustee filed a final report with the                   
          bankruptcy court.  On August 24, 1995, the McGuirls filed an                
          objection to the proposed final account.  On October 13, 1995,              
          the bankruptcy court approved the trustee's final application for           
          compensation and ordered the final distribution of funds on hand            
          in petitioner's bankruptcy estate.                                          
               Petitioner subsequently appealed the order providing for the           
          trustee's compensation and fees that were approved by the                   
          bankruptcy court.  At the time of trial on the matter before us:            
          (1) Undisbursed funds remained in the bankruptcy estate's                   
          account; (2) the bankruptcy court had not discharged the trustee            
          of the estate, nor had the bankruptcy court ordered the estate              
          closed; and (3) the estate in petitioner's bankruptcy case                  
          remained open pending the conclusion of litigation between the              
          McGuirls and the trustee of the bankruptcy estate.                          
               2.  The Proceeding in the Tax Court                                    
               Respondent issued a statutory notice of deficiency to                  
          petitioner for the 1993 taxable year on February 20, 1996.4  The            

               3(...continued)                                                        
          U.S.C. 362(a), (b) (1994); In re Krystal Cadillac Oldsmobile GMC            
          Truck, Inc., 142 F.3d 631, 637 (3d Cir. 1998).  The stay is                 
          lifted upon the earlier of the closing of the case, the dismissal           
          of the case, or upon the granting or denial of a discharge.  11             
          U.S.C. 362(c)(2) (1994); Guerra v. Commissioner, 110 T.C. 271,              
          275 (1998).                                                                 
               4    Respondent issued separate statutory notices of                   
                                                             (continued...)           


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