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Patrick Purcell Trust (the trust).3 The sisters chose Sherry
Purcell’s home address as the address of the trust.
The trust reported on Form 1041, U.S. Income Tax Return for
Estates and Trusts, the following taxable items for 2003:
Interest income of $65, total ordinary dividend income of $378,
and annuities, royalties, and other nonpassive income of $90,915.
On the Distribution Allocation Worksheet for the 2003 Form 1041,
the trust reported that it distributed the following taxable
items: Interest income of $64, total ordinary dividends income
of $373, and annuities, royalties, and other nonpassive income of
$89,627. The trust reported on Schedule K-1 (Form 1041),
Beneficiary’s Share of Income, Deductions, Credits, etc., total
distributions for 2003 to petitioner Carolee Purcell of $45,033,
consisting of interest income of $32, dividend income of $187,
and business income of $44,814.4
In addition to the items discussed above, the trust received
and distributed: (1) Benefits from a life insurance policy on
3 The record includes inconsistencies in the taxpayer
identification number (TIN) used by the trust and in the date of
trust formation. The items of income, deduction, and credit for
the two TINs are identical. From the record before the Court,
Mr. Purcell established only one living trust to benefit his
daughters. Accordingly, we do not consider these discrepancies
significant.
4 Although the declaration of trust was not introduced in
evidence, it is clear from the record that Mr. Purcell intended
his daughters to benefit equally from the trust. The amounts
reported as distributed to petitioner Carolee Purcell represent
one-half of the total distributions.
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Last modified: March 27, 2008