Larry J. and Anita L. Lundgren - Page 4

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          Chisum,3 a.k.a. J.C. Chisum (Mr. Chisum), the Lucky Kirt Trust’s            
          trustee; however, Dennis Roemer was not present during the                  
          signing of the trust documents, nor did he read the trust                   
          documents.  To fund the trust, Raymond Roemer transferred land              
          located in Gove County, Kansas, to Lucky Kirt Trust by warranty             
          deed dated December 14, 1992, and recorded July 28, 1993.4                  
               Upon the purported creation of the Lucky Kirt Trust, Mrs.              
          Lundgren signed the “Minutes of Lucky Kirt” in the capacity of              
          secretary, and her handwritten name appears on the signature line           
          for the general manager.  In the same document, Mr. Lundgren                
          signed in the capacity of the assistant general manager, and Mr.            
          Chisum signed in the capacity of the managing agent on behalf of            
          the trust’s trustee, The Prudent Man Trustee Co. (Prudent Man               
          Trustee).  Mr. Chisum did not have any documentation relating to            
          his authority via the Prudent Man Trustee or Lucky Kirt Trust to            
          sign documents as managing agent and did not provide a copy of              
          the Lucky Kirt Trust document.  Petitioners did not at any time             

               3 Jimmy Clayton Chisum is a known promoter of tax-avoidance            
          schemes.  Aspects of his tax-avoidance schemes are described in             
          Lipari v. Commissioner, T.C. Memo. 2000-280 (sec. 6673 penalty              
          imposed on taxpayers who claimed they were unable to obtain                 
          records from Mr. Chisum, “trustee” of their “trust”) and George             
          v. Commissioner, T.C. Memo. 1999-381 (“trust” of which Mr. Chisum           
          was “trustee” was a sham, and payments received by that “trust”             
          were income of osteopathic physician who performed services that            
          generated the income).                                                      
               4 The record contains references to Lucky Kirt II trust and            
          Lucky Kirt Trust II.  There was never a trust named Lucky Kirt              
          II, rather Lucky Kirt II was the name given to the Legg Mason               
          Wood Walker (Legg Mason) option trading account.                            




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