Levi-Sensei (Sensei) owns a piece of land with structures built on it. Sensei, with his wife and children, exchanged the properties for stocks in LeeOppa Incorporated, which is basically owned and managed by Sensei and his family only. Some few years after, Levi-Sensei died. Somehow through an "anonymous tip" submitted to it, BIR discovered about these properties and it went after Levi-Sensei's estate for evading payment of estate tax for the said properties. Sensei's daughter as the administratrix of his father's estate argued against the BIR that the said properties are not subject to estate tax because they are owned by LeeOppa Inc. which has a distinct personality from that of his deceased father. Besides, a corporation cannot die and thus cannot be subjected to estate tax. Was there tax evasion? Explain.
Levi-Sensei (Sensei) owns a piece of land with structures built on it. Sensei, with his wife and children, exchanged the properties for stocks in LeeOppa Incorporated, which is basically owned and managed by Sensei and his family only. Some few years after, Levi-Sensei died. Somehow through an "anonymous tip" submitted to it, BIR discovered about these properties and it went after Levi-Sensei's estate for evading payment of estate tax for the said properties. Sensei's daughter as the administratrix of his father's estate argued against the BIR that the said properties are not subject to estate tax because they are owned by LeeOppa Inc. which has a distinct personality from that of his deceased father. Besides, a corporation cannot die and thus cannot be subjected to estate tax. Was there tax evasion? Explain.
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