![]() The Eighth Circuit in Scherping, supra, also noted that “proof of strict common law fraud was not required” to apply the reverse piercing branch of the alter ego doctrine, and affirmed the district court’s holding that the trusts were “sham entities created on behalf of and used by the taxpayers to evade payment of their federal income tax liabilities.” 187 F.3d at 802 (citations omitted).Ĭourts that have been called upon to apply the alter ego doctrine in tax cases use objective factors in determining whether an alter ego relationship exists. 1976) (non-tax case) (“roof of plain fraud is not a necessary element in a finding to disregard the corporate entity.”) (citing, among other cases, Anderson v. ![]() Tri-County Excavating, Inc., 62 F.3d at 508 (Under Pennsylvania law, “no finding of fraud or illegality is required before the corporate veil may be pierced, but rather the corporate entity may be disregarded ‘whenever it is necessary to avoid injustice.’”) (citations omitted) (non-tax case) DeWitt Truck Brokers, Inc. ![]() FYI Fraud is not a necessary element for the application of the alter ego doctrine. ![]()
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