A word to the wise: “Recent Cases Confirm That Bad Tax Planning = Bad Tax Results.”
Quote of Note from the article:
In late 2003, the Tax Court issued four opinions, in sequence, all addressing the same employee fringe benefit issues with respect to four family-owned farm corporations. These four farm corporations all had essentially the same fact pattern because they were all designed by an attorney who also served as their tax preparer, as well as the taxpayers’ counsel in the Tax Court litigation. . . [t]he taxpayer losses can be explained by the poor design of these farm corporations. This means that the outcome of these cases should present little problem to the traditionally operated family farm corporation. Nevertheless, some important planning points can be gleaned from these cases.”
The four Tax Court cases are as follows: Weeldreyer v. Comm., TC Memo 2003-324; Schmidt v. Comm., TC Memo 2003-325; Tschetter v. Comm., TC Memo 2003-326; and Waterfall Farms, Inc. v. Comm. , TC Memo 2003-327.