Will a judge in a civil case give access to California tax returns schedules C & E?

[EstateQuestion]

Will a judge in a civil case give access to California tax returns schedules C & E?

What is the name of your state (only U.S. law)? California

Known:
1) Brother was a millionaire, sister earns under $30K a year
2) Brother and sister used same tax accountant
3) Brother sold rental property to sister 10 years ago
4) Brother was the property manager
5) Rental income collected by brother - cash only (estimated $5K per month)
6) Under oath from previous hearing, sister says she let brother keep all rental income
7) Sister has claimed she was paying quarterly taxes on the rental income
8) Brother has passed away after being the property manager for 10 years
9) Sister collects rents now and manages the property herself

Want sister's tax return to see if
1) If sister claimed the cash income on her tax return and paid quarterly taxes on the income
2) if sister claimed property expenses on her tax return
3) if sister issued 1099s or W2s to brother
4) Did rental income claimed on tax return go up significantly more after brother's death and sister started accepting checks

The rental property is believed to be part of a constructive trust for the brother. Sister was supposed to give the property to the estate according to the Will. Sister refuses, claims it is hers.

Thanks for the opinions.

 

[Zigner]

What is the name of your state (only U.S. law)? California

Known:
1) Brother was a millionaire, sister earns under $30K a year
2) Brother and sister used same tax accountant
3) Brother sold rental property to sister 10 years ago
4) Brother was the property manager
5) Rental income collected by brother - cash only (estimated $5K per month)
6) Under oath from previous hearing, sister says she let brother keep all rental income
7) Sister has claimed she was paying quarterly taxes on the rental income
8) Brother has passed away after being the property manager for 10 years
9) Sister collects rents now and manages the property herself

Want sister's tax return to see if
1) If sister claimed the cash income on her tax return and paid quarterly taxes on the income
2) if sister claimed property expenses on her tax return
3) if sister issued 1099s or W2s to brother
4) Did rental income claimed on tax return go up significantly more after brother's death and sister started accepting checks

The rental property is believed to be part of a constructive trust for the brother. Sister was supposed to give the property to the estate according to the Will. Sister refuses, claims it is hers.

Thanks for the opinions.

Sounds to me like it's your sister's property. You have no business asking for the tax return, much less seeing it.

I'm sure the estate's attorney has explained this all to you...

 

[LdiJ]

What is the name of your state (only U.S. law)? California

Known:
1) Brother was a millionaire, sister earns under $30K a year
2) Brother and sister used same tax accountant
3) Brother sold rental property to sister 10 years ago
4) Brother was the property manager
5) Rental income collected by brother - cash only (estimated $5K per month)
6) Under oath from previous hearing, sister says she let brother keep all rental income
7) Sister has claimed she was paying quarterly taxes on the rental income
8) Brother has passed away after being the property manager for 10 years
9) Sister collects rents now and manages the property herself

Want sister's tax return to see if
1) If sister claimed the cash income on her tax return and paid quarterly taxes on the income
2) if sister claimed property expenses on her tax return
3) if sister issued 1099s or W2s to brother
4) Did rental income claimed on tax return go up significantly more after brother's death and sister started accepting checks

The rental property is believed to be part of a constructive trust for the brother. Sister was supposed to give the property to the estate according to the Will. Sister refuses, claims it is hers.

Thanks for the opinions.

How can you say in one breath that brother sold the property to sister 10 years ago, and then say in another breath that the property is believed to be part of a constructive trust for the brother? If sister owned the property brother's will could not control what happens to the property.

What do you think actually went on here?

Are you thinking that brother "sold" the property to sister in order to not have the income in his name?, but retained constructive ownership? If so, then I am quite sure that the income was reported on sister's taxes because otherwise it would defeat the entire purpose of the fraud that brother and sister were committing.

 

[Zigner]

How can you say in one breath that brother sold the property to sister 10 years ago, and then say in another breath that the property is believed to be part of a constructive trust for the brother? If sister owned the property brother's will could not control what happens to the property.

What do you think actually went on here?

Are you thinking that brother "sold" the property to sister in order to not have the income in his name?, but retained constructive ownership? If so, then I am quite sure that the income was reported on sister's taxes because otherwise it would defeat the entire purpose of the fraud that brother and sister were committing.

If the sister reported the income and paid taxes...then what fraud are you talking about?

 

[LdiJ]

If the sister reported the income and paid taxes...then what fraud are you talking about?

Its a classic scenario...

Wealthier family member puts assets in the name of a lower tax bracket family member, in order to pay dramatically less taxes on the income...but retains the actual income for themselves and retains control of the property (and usually pays the taxes for the lower income family member). Since brother retained the income for himself the taxes should have been paid at his marginal tax rate, not hers.

Its one reason why Congress established the Kiddie Tax.

Nevertheless, I agree that it's sister's property and no matter what the will says, I see no way for the estate to make a claim to own the property.

 

[Zigner]

Its a classic scenario...

Wealthier family member puts assets in the name of a lower tax bracket family member, in order to pay dramatically less taxes on the income...but retains the actual income for themselves and retains control of the property (and usually pays the taxes for the lower income family member). Since brother retained the income for himself the taxes should have been paid at his marginal tax rate, not hers.

Its one reason why Congress established the Kiddie Tax.

Nevertheless, I agree that it's sister's property and no matter what the will says, I see no way for the estate to make a claim to own the property.

Gotcha - I'm thinking this would fall short of fraud, legally speaking. Sure, it's slimy...but it's a loophole. All those cash payments...gifts from sister to brother.

 

[EstateQuestion]

How can you say in one breath that brother sold the property to sister 10 years ago, and then say in another breath that the property is believed to be part of a constructive trust for the brother? If sister owned the property brother's will could not control what happens to the property.

What do you think actually went on here?

Are you thinking that brother "sold" the property to sister in order to not have the income in his name?, but retained constructive ownership? If so, then I am quite sure that the income was reported on sister's taxes because otherwise it would defeat the entire purpose of the fraud that brother and sister were committing.

Agree that it would make sense for the sister to claim the income and be taxed at a lower tax bracket then the brother plus given the rents were paid in cash, rent income reported on tax return could be anything less than what was collected.

Sister bought the property from the net proceeds of a previous sold property. The property was a house next door to the brother. The brother wanted the house, but the owner disliked the brother and refused to sell. Sister, who did not qualify for the loan given her income and savings bought the house somehow and kept it for a few years. A handwritten signed note by the brother at one point instructs the sister to sell the property and divide the proceeds with her siblings. Brother changed mind and the bought the rental property. Yes this is complicated.

Back to my original question, will a judge let us see the sister's tax returns? Thanks

 

[EstateQuestion]

Agree that it would make sense for the sister to claim the income and be taxed at a lower tax bracket then the brother plus given the rents were paid in cash, rent income reported on tax return could be anything less than what was collected.

Sister bought the property from the net proceeds of a previous sold property. The property was a house next door to the brother. The brother wanted the house, but the owner disliked the brother and refused to sell. Sister, who did not qualify for the loan given her income and savings bought the house somehow and kept it for a few years. A handwritten signed note by the brother at one point instructs the sister to sell the property and divide the proceeds with her siblings. Brother changed mind and the bought the rental property. Yes this is complicated.

Back to my original question, will a judge let us see the sister's tax returns? Thanks

Trying not to make your head explode, but brother had other properties in other siblings names.

 

[Zigner]

Agree that it would make sense for the sister to claim the income and be taxed at a lower tax bracket then the brother plus given the rents were paid in cash, rent income reported on tax return could be anything less than what was collected.

Sister bought the property from the net proceeds of a previous sold property. The property was a house next door to the brother. The brother wanted the house, but the owner disliked the brother and refused to sell. Sister, who did not qualify for the loan given her income and savings bought the house somehow and kept it for a few years. A handwritten signed note by the brother at one point instructs the sister to sell the property and divide the proceeds with her siblings. Brother changed mind and the bought the rental property. Yes this is complicated.

Back to my original question, will a judge let us see the sister's tax returns? Thanks

The tax returns are irrelevant since there is no question about who owns the property.

 

[EstateQuestion]

Sounds to me like it's your sister's property. You have no business asking for the tax return, much less seeing it.

I'm sure the estate's attorney has explained this all to you...

The attorney does not want to mess around with tax issues, thinks enough existing documentation to show property was part of a constructive trust. I thought the tax issues would help. Thanks for your thoughts.

 

[EstateQuestion]

The tax returns are irrelevant since there is no question about who owns the property.

Thanks for your thoughts

 

[LdiJ]

Trying not to make your head explode, but brother had other properties in other siblings names.

Oh GAWD...

Then all of those properties belong to all of those siblings and the last thing that any of you should be attempting to do is to transfer any of those properties back to the estate or trust. You would be creating nightmares for all of you. You should all keep ownership of everything that is in your names and only deal with what property is actually in brother's name.

I am telling you right now that your sister is the only one being smart if she is the only one taking control of her own property. What were you all thinking?

 

[EstateQuestion]

Oh GAWD...

Then all of those properties belong to all of those siblings and the last thing that any of you should be attempting to do is to transfer any of those properties back to the estate or trust. You would be creating nightmares for all of you. You should all keep ownership of everything that is in your names and only deal with what property is actually in brother's name.

I am telling you right now that your sister is the only one being smart if she is the only one taking control of her own property. What were you all thinking?

I would agree except there is another problem. The brother had three Wills, the first one written in 1998 gave the estate to the youngest sibling. Eight years later in 2006 the brother created another Will or really more instructions (type written with signature) giving estate to all siblings.Three years later in early 2009 brother made a holographic Will giving estate to all siblings with youngest being the executor. Brother died late in 2009. Days after the holographic Will reading, the Will was supposedly lost along with the 2006 instructions. Youngest sibling went with the 1998 Will giving everything to her. Using backdated deeds with new owner field blank, the youngest sibling transferred all properties to her. Fast forward four years, the court believed there was a 2009 Will and removed the youngest sibling as the executor. Determination of the properties is now in court. The estate is large with plenty of money to go around in spite of estate taxes. Unfortunately, two siblings became greedy. A pretty sad situation.

 

[LdiJ]

I would agree except there is another problem. The brother had three Wills, the first one written in 1998 gave the estate to the youngest sibling. Eight years later in 2006 the brother created another Will or really more instructions (type written with signature) giving estate to all siblings.Three years later in early 2009 brother made a holographic Will giving estate to all siblings with youngest being the executor. Brother died late in 2009. Days after the holographic Will reading, the Will was supposedly lost along with the 2006 instructions. Youngest sibling went with the 1998 Will giving everything to her. Using backdated deeds with new owner field blank, the youngest sibling transferred all properties to her. Fast forward four years, the court believed there was a 2009 Will and removed the youngest sibling as the executor. Determination of the properties is now in court. The estate is large with plenty of money to go around in spite of estate taxes. Unfortunately, two siblings became greedy. A pretty sad situation.

None of that changes the fact that anything that was owned by anyone other than the brother when he died, is the property of that person and not subject to the will or trust.

 

[EstateQuestion]

None of that changes the fact that anything that was owned by anyone other than the brother when he died, is the property of that person and not subject to the will or trust.

Thanks for your thoughts. The court initially ruled that the properties belong to the estate, but because the question of ownership was not before the court, the ruling was reversed by appeal and now back in court.