Note 1

"1.  Decedent: had a POD account in Hallmark Bank with Jean Nader. The bank erroneously paid the amount to the estate. This figure is the interest earned on that sum while in the estate account." (Accounting entanglement $270.82)



1992.05.29   (Anthony O'Connell to Edward White) (Copies to E. A. Prichard, Forrest Balderson, Jean Nader and Sheila O'Connell)
"Thank you for your letter concerning the Seventh Trust accounting. In the future would you please send letters concerning me or the trust directly to me? It will save the beneficiaries attorney expense. I would appreciate you sending a copy to Mr. Prichard. I talked with Mr. Forrest Balderson today. Mr. Balderson prepared the account and states that the numbers are correct. He reminded me that court accounting and taxable accounting are different animals and often do not match. I believe this applies to your questions in paragraphs 1 and 2. Please feel free to call Mr. Balderson at (703) 549-7800.
I will try to address your paragraph 3. Rather than wait until the end of each year and calculate the exact net income of the trust to be distributed to my mother, I estimated the net income in April so I could make the distribution to her immediately after the trust received the annual April payment. The consequent year end adjustments were:
Third Account                $ -5,906.72 (Mother owed to trust)
Fourth Account               $  - 687.03 {Mother owed to trust)
Fifth Account                $ +5.796.98 {Trust owed to mother)
Sixth Account               $  -2.908.97 {Mother owed to trust)
Net carryover                 $ -3.705.74 {Mother owed to trust)
Seventh Account,1991  $ +5.181.71 {Trust owed to mother}
The net carryover of $-3.705.74 up to the seventh account combined with the $ +5.181.71 of the seventh account netted $1.475.97 the trust owed my mother. This is the $ 1,475.97 check I mailed to you. Mr. Balderson tells me he called you concerning the real estate taxes before he did the account and discussed it with you. Is it necessary to change it now? My trust accounting is on a cash basis. I think a per diem split of the September interest would be accrual accounting. I don't think I can mix the two methods. If the Commissioner of Accounts says it's appropriate, it's fine with me. At this point in time, I believe Mr. Balderson and I are of one mind that the estate does not owe the trust and the trust does not owe the estate.
I have a few questions concerning my mother's 1991 tax return.
1. My copy shows she should be penalized by IRS and Virginia because adequate estimated tax payments were not made after her death. I believe my sister is convinced I am responsible for this. If it is my fault, I will pay for it out of my pocket. I feel the other beneficiaries should not be charged for the negligence of another. Would you please lay out the specifics on what happened?
Please be very specific.
2. My copy also does not show the principal of $125,188.17 paid to my mother by the Lynch Note in April of 1991. It does show the interest. With a gross profit percentage of .79 on the installment sale, about S 98,898.65 of the $125,188.17 should have been reported on line 13 of the 1040 as a capital gain. It appears that this omission is up and above the penalties and interest already acknowledged. Why was it not reported? Will you amend the return?
*3. On Schedule B under dividend income, what is the significance of "**BAL ON 1040 OF JEAN NADER, SSN 225 50 9052"?  I look forward to your response."
Your truly , Anthony O'Connell "

*I did not get a response to question 3 from Edward White or the CPA Firm.

1993.04.26   (Edward White to Jean Nader)
"Enclosed are the old Perpetual papers you sent me which I do not need any more.
Also enclosed are the 1991 and 1992 statements of interest paid by them. I called Crestar and they said the account was closed in January. I had a note stating that it was closed in January 1991, but it must have been 1992. The $63.17 in earnings would have been for that period of time in 1992. *Since this was a joint account, the income was yours. Since you sent me that statement, I assumed you had picked it up for your return.
The 1991 interest was reported under your mother's final return.
Allison's letter is also in this package.
Sincerely, Edward J. White"

*I don't understand why Edward White would assume that Jean Nader reported this on her individual return?

1993.05.17 (Crestar Bank to Jean O'Connell and Jean Nader)
May 17,1993  
Ms. Jean M.O'Connell
Ms. Jean Nader
350 4th Avenue
North Kensington, PA 15068
Dear Ms.O'Conncll and Ms. Nader:
PIease respond before June 15,1993.
This letter contains important information about your former Perpetual Savings Bank
certificate of deposit(s). You may remember that Perpetual Savings Bank was declared insolvent last year by the Resolution Tmst Corporation (RTC). All insured funds were transferred to &star Bankon January 10,1992. At that time, all certificate of deposit accounts were closed and a Crcstar cashiers ch k for e balance of the account was mailed to the ownm at their last known address.
Cashiers checks #88052398 in the amount of $11, 208.22 was issued to you on January 24, 1992 for certificate #66211061. However, the check was subsequently returned to Crestar because of an incorrect address. Efforts by Crestar to locate a better address identified the above to which this letter was sent.
These extra efforts to locate you are being made because our purchase agreement with the RTC requires that we return to them any transferred deposits that have not been "claimed" within 18 months of the acquisition date, This includes the funds for uncashed Crestar checks issued for closed certificate of deposits. Unless action is taken by you, Crestar will be required to return the balance of your Perpetual certificate of deposit to the RTC, which means your FDIC insurance coverage will expire and you may be prevented from claiming the full amount of your insured deposit.
It is important that you contact me, Carolyn Chenoweth at (804)782-7332, or Doreen Gregory at (804)782-7185, immediately to prevent your funds being returned to the RTC. *Upon contacting us, we will instruct you as to what will be required to make and validate your claim. A replacement check will be sent to you after we have received the necessary documentation. We look forward to hearing from you as soon as possible so we may assist you in recovering your funds.
Carolyn D. Chenoweth

*I don't understand why the bank had no problem sending the $11,208.22 check to me but requires Jean Nader to sign some unspecified necessary documentation for her to get her check. Can we see this necessary documentation?

1993.09.13 (Edward White to the IRS, First amendment to the estate tax return for Jean O'Connell)
The amendment to this return is due to the discovery of a jointly owned certificate of deposit, held by the decedent and Jean M. Nader.
The amended return shows this as Item 2 on Part 2 of Schedule E; The estate's check in the amount of $3629.09 for the additional tax is enclosed.
The certificate was held by Perpetual Savings Bank of the District of Columbia and Northern Virginia. That institution was declared insolvent and was taken over by the RTC. The accounts of Perpetual were transferred to Crestar Bank on January 10, 1972. Enclosed is a copy of a letter from Crestar Bank outlining the discovery of this account and its subsequent payment to the Co-holder, Jean M. Nader in the late Spring of 1993.
On March 16, 1992, within the nine months period for filing the 706 return, the undersigned went to Crestar to check if there were any outstanding accounts in the name of the decedent. At that time Crestar could find no such accounts, but stated that the Perpetual accounts received by Crestar, were in very poor condition, and that much confusion existed concerning Perpetual's paperwork.
The decedent died on September 15, 1991. Crestar sent the payoff check to the decedent on January 24, 1992 apparently to the *wrong address, as she had moved into a nursing home prior to her death.
In view of the fact that efforts had been made to ascertain the existence of all assets of the estate, and the fact that the Co-Executors had no knowledge of this account, it is requested that penalties and interest be waived in this case.
Edward J. White

*Before Jean O'Connell's death the bank was using her correct address:

Jean O'Connell
Room 1128
Goodwin House West
3440 South Jefferson Street
Falls Church, Virginia 22041

After Jean O'Connell's death the bank used her previous address (Which happens to be Anthony O'Connell's new address):

Jean O'Connell
6541 Franconia Road
Springfield, Virginia 22150

Can we find out who changed Jean O'Connell's address for this account after her death?

I don't understand why the bank continued to use the wrong [my] address in mailing their IRS Form 1099 equivalent for this POD CD that I received on January 21, 1993, after I had returned their letter of January 24, 1992, containing the check, telling them it was the wrong address.


Before Jean O'Connell died she told us that the purpose of the POD CD was to reimburse Jean Nader for her expenses as co-executor. It didn't make sense to me since the executor's commission does this but I didn't say anything. History suggests that the accountant's instructed her to do this. Jean O'Connell would not do this on her own. If your family has been advised to make a CD POD between the testator and a family fiduciary for the alledged purpose of compensating the family member for the expenses they would incur as a fiduciary, beware.

This is a flag of confusion with far reaching accounting entanglements. It entangles the accounting of Jean O'Connell's individual tax return, her Estate, Jean Nader's individual tax return, and the court accounting. It results in amending the estate tax return.

This amended estate tax return in Note 1, made to appear as if it were the family's fault, and the extension request for the estate tax return in Note 3, made to appear as if it were the family's fault, covers and diverts attention from the $70,051 that disappeared with the two versions of the extension request for the estate tax return and for the two versions of the estate tax return.

One facet of this makes it appear that I am trying to get Jean Nader's money. The bank sent a check for $11,206.22 for Jean Nader to me. I don't thing I opened the envelope but just wrote something like "return to sender, wrong address" on the envelope. I don't understand why the bank continued to use the wrong address in mailing their *IRS Form 1099 equivalent for this POD CD that I received on January 21, 1993, after I had returned their letter of January 24, 1992, containing the check, telling them it was the wrong address.

*What I've previously been calling a bank statement is the equivalent of IRS Form 1099; the bank reporting to the IRS the interest that the bank paid the customer. The taxpayer ID is Jean O'Connell's, the address is Anthony O'Connell's, and the names are Jean M O'Connell and Jean Nader.

There are so many facets to this but it's the basic 1,475.97 - 816.00 = 659.97 pattern;. Lots of accounting entanglements are created and made to appear as the family's fault with the accountants just trying to help.

  1. Bank requires Jean Nader to sign something before she can get her money but they won't put it in writing.
  2. Sent to my address. (list Jean Letters)
  3. Fear, Edward White protecting Jean Nader from IRS
  4. My fault because of the information I gave Jean (boxes)
  5. Accounting entanglement ($270.82