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furniture; another to buy the leasehold. Petitioner told
Wilberding that these were all flow-throughs and that this was
the way to get tax savings.1
Petitioner began working at the restaurant in the early
1980's. He worked there 6 to 8 hours per day during the years in
issue, but neither he nor Wilberding was on the payroll.
Petitioner kept the books, counted the receipts, made the
deposits at the bank, and handled tax and other financial
matters. Petitioner told people he was the "business manager" or
"business manager for the creditors". Wilberding handled the
day-to-day operations, such as hiring and scheduling employees,
cooking, and waiting tables.
At various times, petitioner held himself out as owner of
the building in which the restaurant was located, as a creditor,
as a shareholder of Wayanne before the years in issue (claiming
in testimony that he sold his interest to his father in 1986,
which he described as the sale of stock), as an employee (in
1 The IRS agent testified that she located 14 corporations,
13 partnerships, and 3 trusts related to petitioner. Although
petitioner objected that some of them were not his, it is obvious
from a cursory glance at Exhibit AL that many were mentioned by
petitioner himself during the trial, and others seem clearly
related by the names (such as (Don) Ferry Family Trust, Inc.,
Ferry Family Trust, Don Ferry Limited Trust, Restaurant Equipment
& Property Ltd - D. Ferry Ltd. Trust, Gen. Ptr.).
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