The Cleveland Trencher Company - Page 5

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          Petitioner's financial posture was and continues to be shaky.               
          Mr. Aydin's purchase of petitioner saved, at least temporarily,             
          the jobs of several individuals.                                            
               Mr. Aydin has a valid "green card", which was issued to him            
          in 1972, confirming his status as a resident alien of the United            
          States.  Mr. Aydin is of Armenian descent and continues to use a            
          Turkish passport.  Mr. and Mrs. Aydin filed a joint U.S.                    
          individual income tax return on Form 1040A for the calendar year            
          1989 and are cash basis taxpayers.  Mr. and Mrs. Aydin reported             
          no income from AA&H on that joint return.                                   
               AA&H has a one-room office in petitioner's building in                 
          Cleveland.  Mr. Aydin carried out extensive business for AA&H.              
          AA&H never filed any U.S. income tax returns.  Although evidence            
          was presented at trial that AA&H did business in Turkey, there is           
          no evidence that it was registered to do business there.  If AA&H           
          had any books and records at all for the years 1988 and 1989,               
          Mr. Aydin sent them to Turkey.                                              
               Petitioner at some time in 1986 entered into an agreement              
          with the General Directorate of Rural Services, Republic of                 
          Turkey (Turkish Government) to build 10 Cleveland Trencher                  
          trenching machines for $1,797,540.  Petitioner entered into a               
          second agreement, dated November 1, 1988, with the Turkish                  
          Government to build 25 Cleveland Trencher trenching machines for            

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Last modified: May 25, 2011