Trust Treated Same As Taxpayer For Tax Purposes.

The petitioner formed an S corporation for his cabinet business and utilized it for over twenty years until its liquidation.  Later, a "pure trust" was formed with the cabinet shop's land, building, equipment and inventory transferred to it.  A series of transactions ensued with the ultimate result that petitioner did not report any tax from the transactions.  The IRS asserted, and the court agreed, that the trust was a sham and that the petitioner was taxable on lease payments.  Wheeler v. Comr., T.C. Memo. 2014-204.

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