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1989 Date Amount Location Purchased
Apr. 20 $3,000 Commerce Savings
June 8 9,000 Commerce Savings
June 8 10,000 Bank of Alex Brown1
June 12 9,000 Wells Fargo
June 14 1,432 Wells Fargo
June 14 2,594 Wells Fargo
1 Respondent conceded that the $10,000 cashier’s check was
from a source that was not taxable to McDonald.
Respondent determined that these amounts, along with $1,000 cash
deposited by McDonald in the M&M trust account, constitute income
to McDonald because the source of the cash was untaxed income
from clients that had not been deposited into the bank or
otherwise reported as income for financial or tax purposes.
With respect to the $2,500 item from McDonald’s daughter to
Maynard, petitioners argue that Maynard first gave the $2,500 to
McDonald’s daughter, who, in turn, gave it to McDonald to
purchase the $2,594 cashier’s check that went to purchase the
home placed in McDonald’s wife’s name. Ultimately, petitioners
would have us believe that this circuitous route for the $2,500
was concluded when McDonald’s daughter repaid Maynard. Other
than the $2,500 item, petitioners make no particular argument
with respect to the cash items that respondent determined were
income to Maynard. With respect to McDonald, it is contended
that he had available to him from both taxable and nontaxable
sources almost $21,000 with which to purchase the cashier’s
checks remaining in controversy. Ostensibly, the $21,000
represents all of McDonald’s sources from which he was able to
make applications, which would include, in addition to purchasing
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