Harvey I. Epstein and Arlene B. Epstein - Page 4

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          Arlene reentered the work force on a part-time basis.  Beginning            
          in 1974, and thereafter, she sold advertising space in the South            
          Shore Record, a local newspaper, for which she was paid                     
          commissions.  She also wrote a weekly drama review column for the           
          same paper, for which she was paid nominal amounts.                         
               At the end of each year, petitioners' accountant, Paul                 
          Kreindler (Kreindler), would ask Arlene to prepare and submit to            
          him handwritten statements reflecting her travel and other                  
          business expenses, as well as Forms 1099 and/or Forms W-2 that              
          she received from her employers (including, in 1978, Atl. Beach             
          Tennis), for the purpose of preparing Schedule C to reflect                 
          Arlene's commissions, fees from writing, and any other income-              
          earning activities.                                                         
               Petitioners reported Schedule C income from Arlene's                   
          activities as follows:                                                      
               Year      Gross Receipts      Net Profit                               
               1976      $5,715              $3,017                                   
               1977      7,663               4,880                                    
               1978      7,724               4,941                                    

               Petitioner used the money she earned to purchase art works--           
          mostly works on paper--and a fur jacket, because Harvey refused             
          to give her money for these purposes.  Arlene also used money she           
          received from her father to buy one or two things.  Arlene never            
          received any large, unusual, or lavish gifts from her husband.              







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