Kathy B. Enterprises, Inc. v. United States

This case involves the Internal Revenue Service’s attempts to collect taxes from the recipient of a delinquent taxpayer's fraudulent conveyance. The district court found for the Service, and we affirm.

I

FACTS

Jerome Swanson (the taxpayer) operated a bookkeeping and tax preparation business in Illinois from 1965 to 1979. On August 31, 1979, the taxpayer transferred his bookkeeping practice and the bulk of its assets to Kathy B. Enterprises, Inc. (Kathy B.), the appellant. Kathy B. sells medical equipment and appliances. Until this transaction, Kathy B. had never engaged in the accounting…