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1988, complaint in the constitutional challenge action, they
alleged that Rhys received no compensation from NITCO and had no
formal responsibilities at NITCO. We hold that the $22,646
payment was constructive dividend income to Mr. Mussman in 1988.
Rule 142(a).
"Open Account Loans"
NITCO on its books recorded certain payments that it had
made as "open loan account payments" to Mr. Mussman. In the
notice of deficiency issued to the Mussmans, respondent
determined that $13,814 in "open account loans" that NITCO made
for 1988 and $16,792 in "open account loans" that NITCO made for
1989, represented constructive dividend income to Mr. Mussman.
Respondent has now conceded that certain of the 1988 and 1989
payments NITCO made were not constructive dividend income to Mr.
Mussman. Petitioners, on the other hand, have conceded that
certain other of the 1988 and 1989 payments NITCO made were
constructive dividend income to Mr. Mussman. Still at issue
between the parties is whether the remaining $7,058.11 of 1988
"open account loans" and the remaining $3,263.51 of 1989 "open
account loans" were constructive dividend income to Mr. Mussman.
Of the remaining $7,058.11 in disputed 1988 payments, the
parties agree that at least $6,119.95 of the payments was for
utility bills with respect to the 301 North Washington Street
property that NITCO was subleasing to NICATV, Rhys's cable
television company. The parties cannot agree on the
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