- 3 -
At a time not disclosed in the record, and perhaps because
of the death of her husband, Mrs. Myers became the sole trustee
of the trust.
By March 2001, the health of Mrs. Myers had seriously
deteriorated. Accordingly, at that time, Mrs. Myers named
Community First National Bank (currently, Bank of the West) as
successor trustee. The institutional trustee continued to
administer the trust for the principal benefit of Mrs. Myers.
On July 16, 2001, petitioner’s mother died. At that time,
what had been a revocable trust became an irrevocable trust
pursuant to the trust indenture. Thereupon, petitioner was the
sole beneficiary, and the institutional trustee was required to
distribute all income to him currently.
During the last 5-1/2 months of 2001, the institutional
trustee made distributions directly to petitioner and, at
petitioner’s direction, to petitioner’s creditors. However, not
all of the income required to be distributed to petitioner in
2001 was actually distributed to him in that year.2
As the institutional trustee of the Ruth Irene Myers
Irrevocable Trust, Community First National Bank prepared a
Schedule K-1, Beneficiary’s Share of Income, Deductions, Credits,
2 Pursuant to the trust indenture, the Ruth Irene Myers
Irrevocable Trust terminated in 2002. The institutional trustee,
although required to distribute all income currently to
petitioner, deferred complete distribution during the winding up
process for the trust.
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Last modified: May 25, 2011