g) IRS Tax Claim. In November 2018, the Internal Revenue Service sent the Trustee a bill for $477,864.91 allegedly arising out of the 2016 Form 1120 filed by UWBI on behalf of its consolidated group, including the Bank. This billing was not preceded by an audit, appeal or any form of due process. The alleged tax liability arises out of the Bank receivership, the tax characteristics of which are reported to the Trustee by the FDIC as Receiver for the Bank. FDIC takes the position that income generated by its Receivership is exempt from income tax pursuant to Section 7507 of the Internal Revenue Code and the Trustee takes the same position as to Receivership income reflected on the consolidated Form 1120. Immediately after this initial correspondence was received, Mr. Parsons, alongwith the Trustee’s accountants, began analyzing the claim and communicating with IRS representatives concerning the issue. For several months it appeared the IRS was refusing to allow the Estate an audit, appeal rights or any other form of due process. In light of the IRS’s position, Mr. Haynes, assisted byMs. Gilbert, Mr. Silvestro and Mr.Dougherty,researchedandanalyzedlitigationalternativestoobjecttoandobtainareviewand adjudication of the Estate’s tax liability under 11 U.S.C. §505, among other alternatives, or obtaining reimbursement of any actual tax liability, ultimately drafting pleadings. On July 26, 2018, an IRS representative advised Mr. Parson’s that the IRS may grant the Estate an audit and appeal rights. At that time,litigationwasput onholdandtheTrusteehasbeenexploringthe IRS’s offer. As of the time of the filing of this interim application, an audit has been scheduled and rescheduled several times but has not yet taken place. Invoices supporting these charges are attached as Exhibit B-
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