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salary from L.A. Trading and that he did not know what she did
with those paychecks. Petitioners have not persuaded us that
petitioners' own funds were not deposited into these accounts.
Respondent's determination that petitioners' children's bank
accounts are included in petitioners' net worth will be
sustained.
b. 1980 Buick. Petitioners contend that respondent failed
to include in their net worth a Buick they purchased in 1980.
Yoon testified at trial that the Buick cost $10,000 when he
purchased it in 1980. Petitioners traded the Buick when they
purchased their 1989 Isuzu. Respondent has not argued that the
Buick was not owned by petitioners in 1988 and has conceded that
petitioners' 1989 net worth should be reduced by $800, the trade-
in value of the Buick.
In making use of the net worth method, actual cost, not fair
market value, is to be used. See Kelley v. Commissioner, T.C.
Memo. 1964-267. We conclude that petitioners' net worth on
December 31, 1988, should be increased by $10,000 and that
petitioners' net worth on December 31, 1989, should be decreased
by $10,000 to reflect the ownership and subsequent sale of the
Buick.
c. JKY capital account. Petitioners argue that respondent
erred in three ways in the calculation of petitioners' JKY
capital account.
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