- 12 -
determined that the Denali Company Trust did not substantiate the
amounts. Additionally, respondent imposed an addition to tax
under section 6651(a)(1) for failure to file in 1995 and
accuracy-related penalties under section 6662(a) for 1995 and
1996.
On their 1995 and 1996 tax returns received on September 23,
1996, and June 13, 1997, respectively, Mr. and Mrs. Norton did
not report any of the income reported by the Denali Company
Trust. In the notice of deficiency for 1995 and 1996, respondent
increased their self-employment income by the net business income
of Denali Company Trust. Respondent determined that,
alternatively: (1) The Denali Company trust is a sham with no
economic substance; (2) the Denali Company Trust is a grantor
trust; and (3) Mr. and Mrs. Norton’s attempted assignment of
income to the Denali Company Trust is not recognized for tax
purposes. Respondent also imposed an addition to tax under
section 6651(a)(1) for failure to file in 1995, and accuracy-
related penalties under section 6662(a) for 1995 and 1996.
Page: Previous 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 NextLast modified: May 25, 2011