Charles R. Harp and April B. Harp - Page 29

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                              Deposits of K & H's Construction Loan                                                                                                        
                              Proceeds, Checking Account Funds, and                                                                                                        
                              Credit Line Funds and Ms. Velilla's                                                                                                          
                              Construction Loan Proceeds and                                                                                                               
                              Checking Account Funds                                                                                                                       
                                                                                                                                                                          
                              The parties agree that (1) during 1989, petitioner deposited                                                                                 
                    into one of petitioners' accounts K & H's funds totaling                                                                                               
                    $544,323.97; (2) during 1989, petitioner deposited into one of                                                                                         
                    petitioners' accounts Ms. Velilla's construction loan proceeds                                                                                         
                    totaling $27,394; (3) during 1990, petitioner deposited into two                                                                                       
                    of petitioners' accounts K & H's funds totaling $81,570.46;                                                                                            
                    (4) during 1990, petitioner deposited into one of petitioners'                                                                                         
                    accounts Ms. Velilla's funds totaling $34,753; (5) petitioners'                                                                                        
                    1989 and 1990 returns did not include any portion of the forego-                                                                                       
                    ing deposits as income; (6) during 1989 and 1990, petitioners                                                                                          
                    made certain payments from their accounts to, or on behalf of, K                                                                                       
                    & H; and (7) to the extent that during 1989 and 1990 petitioners                                                                                       
                    made payments to, or on behalf of, K & H or Ms. Velilla, the                                                                                           
                    aggregate amount of such payments during each such year should                                                                                         
                    reduce the aggregate amount of the foregoing deposits during each                                                                                      
                    such year.  The only disagreements between the parties with                                                                                            
                    respect to the deposits during 1989 and 1990 of K & H's funds and                                                                                      
                    Ms. Velilla's funds are (1) whether the aggregate amount of those                                                                                      
                    deposits during each such year exceeded the aggregate amount of                                                                                        


                    17(...continued)                                                                                                                                       
                    outstanding balances of the Kabeiseman loans would remain the                                                                                          
                    same regardless who bears the burden of proof with respect to                                                                                          
                    that argument.                                                                                                                                         




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