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incorporated by this reference. Petitioners resided in Rogers,
Minnesota, when they filed their petition.
For more than 46 years, petitioners have owned and operated
a 235-acre dairy farm. Petitioner husband also sells parts and
silo loaders.
Prior to 1983, petitioners’ farm assets, personal property,
and real property were held in various trusts, including North
Curve and Orange Run trusts, promoted by Lowell Anderson.2 In
1983, upon the advice and recommendation of James Noske and Norb
Stelton, whom they had just met in a doctor’s office, petitioners
decided to transfer their assets into new “business trusts.” On
November 9, 1983, petitioners executed a bill of sale whereby for
stated consideration of “One dollar and other good and valuable
consideration”, they purported to transfer to Oak Hill their farm
equipment and livestock. On the same day, in their capacities as
trustees for the North Curve and Orange Run trusts, petitioners
purportedly conveyed and quitclaimed their interests in the farm
real estate to Pleasant Acres Co. (Pleasant Acres).
2 On Feb. 24, 1983, Lowell Anderson was indicted by a
Federal grand jury in Wyoming for conspiring to defraud the
United States by selling common-law trusts which were used to
evade Federal income taxes. See United States v. Tranakos, 911
F.2d 1422, 1424 (10th Cir. 1990). Petitioners were issued a
subpoena to testify before the grand jury regarding matters
involving Lowell Anderson, but they were ultimately excused from
testifying. Lowell Anderson died while the criminal proceedings
were pending. See id.
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