August 29, 2011
Enron's Ken Lay Wins Posthumous $3.9 Million Tax Court VictoryThe late former Enron CEO Kenneth Lay won a posthumous $3.9 million victory over the IRS today in the Tax Court in a case argued by ABA Tax Section Chair President Charles H. Egerton (Dean Mead, Orlando). Estate of Lay v. Commissioner, T.C. Memo. 2011-208 (Aug. 29, 2011):
This case involves a deficiency of $3,910,000 determined by respondent in the 2001 Federal income tax of Kenneth L. Lay and Linda P. Lay (the Lays). The deficiency is based upon respondent’s determination that the Lays received income as a result of the sale of two annuity contracts to Enron Corp. (Enron). For the reasons stated herein, we find that they did not receive the income determined by respondent and are not liable for the deficiency. ...
Enron paid Mr. and Mrs. Lay $10 million in exchange for the annuity contracts. Enron intended for the full amount of its payment to be consideration for the annuity contracts. The annuities transaction is well documented, and all actions of the parties to the transaction reflect that Enron purchased the annuity contracts for $10 million. The Lays properly reported the transaction on their 2001 tax return as a sale of their annuity contracts.
(Hat Tip: Bob Kamman.)
Update: Bloomberg, Enron CEO Kenneth Lay Bests IRS in Tax Court
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Tracked on Aug 30, 2011 9:13:13 AM
And these are the people to run our health care?!?
Posted by: Ralph Gizzip | Aug 30, 2011 12:20:40 PM