- 6 -
notes. Decedent made the following loans to Robert’s children:
(1) On December 21, 1978, decedent made a $35,000 mortgage loan to
Theodore Robert, at 6-percent interest, payable over 20 years; (2)
on September 30, 1987, decedent made a $156,000 mortgage loan to
Amy, payable over 20 years; and (3) on June 30, 1989, decedent lent
$140,000 to Margaret. Decedent made the following loans to Betsy’s
children: (1) Decedent lent $15,000 to Phoebe on January 3, 1990;
(2) decedent lent $100,000 to William on September 11, 1992; and
(3) decedent lent $10,000 to Clay on October 9, 1992, and $15,000
on February 23, 1993.
II. Formation of the Family Limited Partnerships and Corporations
A. Introduction to the Fortress Plan
Sometime in 1992 or 1993, Betsy, Robert, and their spouses met
with Christian DeVol and William W. Warder. Mr. DeVol was a self-
employed financial adviser. Mr. Warder was an insurance salesman
and financial adviser with APS Financial Services, Inc. (APS). APS
was the licensee for the Fortress Financial Group, Inc., and as a
licensee APS was authorized to assist in the implementation of the
“Fortress Plan”.4
4 In Strangi v. Commissioner, 115 T.C. 478, 480 (2000),
affd. in part and revd. in part 293 F.3d 279 (5th Cir. 2002), we
described the Fortress Plan promoted by Fortress Financial Group,
Inc. (Fortress) as follows:
(continued...)
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011