- 14 - commercial service units, similar to those petitioner had built on the Prado Road property, were constructed and leased to tenants. Petitioner continued to manage the Cross Street property after its development by overseeing repairs, supervising maintenance and landscaping, responding to tenant complaints, and initiating lease agreements. 3. Trust Income and Distributions The Pago Trust filed Forms 1041, U.S. Income Tax Return for Estates and Trusts, for the taxable years 1994 through 1998.17 Mr. Norton signed all of the Pago Trust’s tax returns but did not review them for accuracy or compare the information reported on the returns to the Pago Trust’s accounting records. In 1994, the Pago Trust’s only source of income was Inga Inc.’s payments on the installment note.18 For the taxable years 1995 through 1998, the Pago Trust derived its income solely from payments on the installment note and from rental fees paid for the units on the Prado Road property. The Pago Trust’s real 16(...continued) by borrowing against the Prado Road property and the Cross Street real estate. 17Mary L. Vincent prepared all of the tax returns filed for the Pago Trust, the McKenzie Trust, and the Gouveias beginning with the 1994 taxable year. Although petitioner did not know what her level of training was, he chose Ms. Vincent because she was familiar with trusts and Forms 1041. 18All of the payments received on the installment note were deposited into the Pago Trust’s bank account.Page: Previous 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Next
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