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1 The parties agree that Dacor paid these amounts to Mr. Cummings in
1989 and that Dacor paid $72,115 to Dwight Cummings in its fiscal year 1989
(Apr. 1, 1988 to Mar. 31, 1989).
2 The parties stipulated that Kadac paid $70,000 to Grant Cummings in
1991 and that a Form W-2 for 1991 showed that Kadac paid him $68,900.04 in
1991. We find that Kadac paid him $70,000 in 1991. The $1,099.96 difference
does not alter our analysis.
3 Respondent determined that Kadac paid $57,793 to Deen Cummings.
Petitioner contends that Kadac paid $57,500. We accept respondent's
determination. The $293 difference does not alter our analysis.
D. Lasercolor, Inc.
Lasercolor was a Washington corporation that did business in
Washington as Wy'East Color. Mr. Cummings acquired Lasercolor in
1988. He owned all of Lasercolor's stock during its fiscal years
ending March 31, 1990 and 1991. Dacor filed a consolidated tax
return with Lasercolor for its fiscal year ending March 31, 1989,
on which Dacor reported that it owned Lasercolor. Lasercolor did
not pay dividends during its 1989 fiscal year.
Lasercolor paid the following amounts for officer
compensation, salaries and wages, and management services:
Management
Services
Fiscal Officer Salaries Paid to
Year Compensation and Wages Kadac
1989 $72,115 $206,002 unknown
1990 none 113,534 $10,385
1991 none 102,769 none
E. Other Related Corporations
During the years in issue, Mr. Cummings owned 30 percent of
Dynagraphics, a printing company in Portland, Oregon, that was
one of petitioner's clients.
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