- 10 - at 240-241 (1998), 1998-3 C.B. 747, 994-995 (reciting the definition of credible evidence). In addition, to shift the burden of proof, taxpayers must maintain all records required by the Code and regulations and cooperate with reasonable requests by the Secretary for witnesses, information, documents, meetings, and interviews. Sec. 7491(a)(2). Petitioners did not satisfy the prerequisites under section 7491(a)(1) and (2) to shift the burden of proof to respondent. They did not produce any evidence or documentation disputing respondent’s determinations or supporting their claims as to the economic substance of the Lucky Kirt Trust. Specifically, they failed to provide either a copy of the trust document for Lucky Kirt Trust or any documentation authorizing Mrs. Lundgren or Mr. Chisum to act on behalf of the trust or present any credible evidence other than their own self-serving testimony that the trust had economic substance or even existed. Similarly, petitioners did not provide any evidence regarding the capital gain determination for 2001 and self-employment tax liabilities for 1999 through 2002. Consequently, except for any penalties subject to section 7491(c), as to which respondent bears the initial burden of production, the general premise of Rule 142(a) remains applicable. III. Lucky Kirt Trust as a Disregarded Entity Taxpayers are generally allowed to arrange and conduct their affairs and structure their transactions to minimize any adversePage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011