Orneal and Martha Kooyers, et al. - Page 26

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          enjoyment of the trust corpus and income.  Third, petitioners               
          used the OMK trusts for their own benefit.  We hold that the                
          income of the OMK trusts is taxable to petitioners under the                
          grantor trust provisions of sections 671-677.                               
               D.   Trusts Lack Substance                                             
               Finally, courts have frequently found that trusts                      
          substantially identical to the OMK trusts are lacking in any real           
          substance and thus are without any effect for Federal tax                   
          purposes.  See, e.g., Zmuda v. Commissioner, supra at 1421;                 
          Muhich v. Commissioner, T.C. Memo. 1999-192, affd. 238 F.3d 860             
          (7th Cir. 2001); Dahlstrom v. Commissioner, T.C. Memo. 1991-264,            
          affd. without published opinion 999 F.2d 1579 (5th Cir. 1993);              
          Clawson v. Commissioner, T.C. Memo. 1982-321.                               
               Taxpayers have a legal right to structure their transactions           
          to minimize their tax obligations by whatever means allowable               
          under the law.  Gregory v. Helvering, 293 U.S. 465, 469 (1935).             
          Transactions that have no significant purpose other than to avoid           
          tax and do not reflect economic reality, however, will not be               
          recognized for Federal income tax purposes.  Zmuda v.                       
          Commissioner, 79 T.C. 714, 719 (1982), affd. 731 F.2d 1417 (9th             
          Cir. 1984).  If a transaction has not altered any cognizable                
          economic relationships, we must look beyond the form of the                 
          transaction and apply the tax law according to the transaction’s            
          substance.  Markosian v. Commissioner, 73 T.C. 1235, 1241 (1980).           






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