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During the years in issue, petitioner served as president
and principal operating officer of Furniture Barn, Inc. (FBI).
Petitioner owned approximately 97 percent of the outstanding
stock of FBI. Petitioner did not receive a salary from FBI
during the years in issue. FBI paid petitioner's personal
expenses, including food, household expenses, and other living
expenses. The following amounts represent expenditures by FBI
for the personal benefit of petitioner:
Year Amount
1982 $36,511.39
1983 53,743.85
1984 60,469.07
1985 54,681.48
1986 33,599.64
Petitioner also used corporate assets for personal purposes
during the years in issue.
Petitioner's son, John B. Mathers, Jr. (Mathers, Jr.),
worked at FBI in sales management and served as vice president.
He received a salary from FBI for his services. During the years
in issue, Mathers, Jr. wrote numerous checks from the FBI account
to pay his personal expenses. Petitioner had knowledge of at
least some of these checks. Petitioner had control over the
check writing of Mathers, Jr. but did not require Mathers, Jr. to
get approval before writing checks for his personal benefit.
Petitioner never told Mathers, Jr. that he was taking too much
money out of FBI. On previous occasions, petitioner had helped
Mathers, Jr. through financially difficult times.
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Last modified: May 25, 2011