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reported tax liabilities, as well as delinquency additions to tax
and interest, for 1995, 1996, and 1997, and sent corresponding
notices of balance due, on August 23, 1999, September 6, 1999,
and August 9, 1999, respectively. Similarly, on October 5, 1999,
petitioner filed a late 1998 income tax return showing a balance
due, which was not accompanied by any payment. The 1998 tax
liability, additions to tax, and accrued interest were assessed
by respondent on November 15, 1999, and a notice of balance due
was sent.
For the 1999 taxable year, petitioner filed a timely return
showing an overpayment and claiming an earned income credit.
Respondent assessed the 1999 tax liability on February 28, 2000,
and transferred an overpayment credit to 1995. Thereafter, on
August 7, 2000, respondent made additional assessments to
petitioner’s 1999 account, and sent a notice of balance due, for
tax, additions to tax, and interest resulting from certain
uncontested adjustments.
After filing her 1995 through 1998 returns, petitioner on
October 26, 1999, created the “Amy H. O’Brien 1999 Irrevocable
Trust”. The trust instrument designated a third party as trustee
and established a support trust for petitioner’s benefit.
Specifically, the trust instrument’s “THIRD” term and condition
provided as follows with regard to distributions:
During my lifetime, the Trustee shall pay the net
income from the trust property at least quarter-
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