-4-
Date Account No. Amount
Apr. 14 064 641-302538 $60,588
Apr. 16 064 641-302538 57,000
Apr. 17 131-403443-8 208,406
Total 325,994
With respect to the $60,588 amount, respondent conceded before
trial that $60,000 was not to be included in income, leaving $588
in controversy. Concerning the $57,000 item, respondent
conceded, on brief, that the record reflected that it is not
includable in income for 1986. The $208,406 item remains in
controversy.
Lowell Thomas Nelson (Mr. Nelson) was involved in the
business of buying and selling real estate investment property.
He met petitioner in the early 1980's in connection with
petitioner's dealings in real property. Mr. Nelson was given
power of attorney by petitioner with respect to a specific
property transaction. It was customary for Mr. Nelson to hold
money on behalf of petitioner. Petitioner had established a bank
account of which he and Mr. Nelson were cotrustees, which enabled
Mr. Nelson to withdraw funds from the account. The account was
opened at Mr. Nelson's request due to petitioner's informal
manner of conducting business and because petitioner sent Mr.
Nelson relatively small sums of money for various purposes which
had accumulated and collectively became a substantial amount.
During the period 1982 through 1987, petitioner and Mr.
Nelson were involved in four or five transactions together. On
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