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F. Events Following Decedent’s Death
Decedent died on July 25, 1999. McBride, as trustee of GRH
Trust, transferred $400,000 to Advance Leasing on September 20,
1999. Advance Leasing had not previously demanded payment of the
promissory note. During 1999, Advance Leasing used the $400,000
it received for the promissory note to repay $400,000 to HELP.
In 1998, Billy Hughes’s wife filed for divorce, his
substance abuse problems worsened, and he stopped working for
Advance Leasing. He entered a rehabilitation center for
treatment late in 1998. Advance Leasing ceased operating around
2000.
G. Decedent’s Estate Tax Return
Decedent’s estate reported on the estate tax return that her
gross estate included $150,000 of principal Advance Leasing owed
on its notes to H & R Properties and GRH Trust, entities owned by
decedent, but did not include $21,782 of interest Advance Leasing
owed on those notes as of July 25, 1999, decedent’s date of
death. Also on that return, decedent’s estate deducted $400,000
as a claim against the estate based on the $400,000 promissory
note.
Decedent’s estate reported on that return that the stock of
Advance Leasing had no value on decedent’s date of death because
liabilities exceeded the fair market value of assets. McBride
signed the return for decedent’s estate.
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Last modified: May 25, 2011