Tax Court Upholds Penalties Against Promoters of Evasionary "Corporation Sole" Tax Scheme

In Gardner v. Commissioner of Internal Revenue, (USTC, Aug. 26, 2015), the U.S. Tax Court upheld $47,000 in penalties assessed by the Internal Revenue Service against a husband and wife who marketed to more than 300 people a tax evasion scheme involving the creation of a purported religious entity -- a "corporation sole."  Defendants claimed that taxpayers could turn otherwise taxable income into tax free income by assigning it to the corporation sole they create and control. BNA Daily Report for Executives [subscription required] reports on the decision.