- 12 -
the taxpayer monthly installments of income from the trust
property and, at the taxpayer's direction, to distribute limited
amounts of principal. Because the taxpayer believed that she was
not receiving the amount of income from the trust to which she
was entitled, she sued the bank, alleging in her complaint
conflicts of interest, breach of fiduciary duty, and trust
mismanagement.
In Estate of Kincaid, we quoted Boagni v. Commissioner,
supra at 713, which described the objective of the "origin-of-
the-claim" analysis and the manner in which it was to be
conducted as follows:
the 'origin-of-the-claim' * * * inquiry is directed to
the ascertainment of the 'kind of transaction' out of
which the litigation arose. Consideration must be
given to the issues involved, the nature and objectives
of the litigation, the defenses asserted, the purpose
for which the claimed deductions were expended, the
background of the litigation, and all facts pertinent
to the controversy.
Estate of Kincaid v. Commissioner, supra. Applying this
analysis, we concluded that the litigation costs incurred by the
taxpayer were deductible under section 212, since "The origin and
character of the 'claim' or protection sought by * * * [the
taxpayer] had its source in the management and conservation of
income-producing property in which * * * [the taxpayer] held an
interest as an income beneficiary." Id. We arrived at this
conclusion based on evidence that the taxpayer "believed that she
was receiving less than her anticipated amount of income because
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 Next
Last modified: May 25, 2011