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petitioner and Ms. Le are liable as transferees under State law
or equity. Sec. 6902(a); Gumm v. Commissioner, supra at 479-480.
We begin with the procedural requirements. They are:
(1) That the alleged transferee received property of the
transferor; (2) that the transfer was made without adequate
consideration; (3) that the transfer was made during or after the
period for which the transferor’s tax liability accrued; (4) that
either the transferor was insolvent before or because of the
transfer of property, or the transfer of property was one of a
series of distributions of property that resulted in the
insolvency of the transferor; (5) that all reasonable efforts to
collect from the transferor were made, and further collection
efforts would be futile; and (6) the value of the transferred
property (which determines the limit of the transferee’s
liability). Gumm v. Commissioner, supra at 480.
On the basis of the record, we conclude that respondent has
met each of these procedural requirements. First, the Les
received corporate funds from DDL in each subject year as
indicated by the diverted checks. Second, corporate funds were
diverted from the corporation to the Les without adequate
consideration. Third, the Les diverted these funds while DDL’s
tax liabilities for the subject years accrued. Fourth, taking
into account DDL’s unpaid tax liabilities, DDL did not have
sufficient assets to pay all of its debts. Fifth, respondent has
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