John R. Boone, Jr. - Page 11

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          percent of his earnings from the time he was 15 years old.                  
          Petitioner also told Hensley that he worked odd jobs, that he had           
          some savings from tobacco sales from his family's farm, and that            
          he and his wife had received a $5,000 wedding gift from Sandra's            
          grandfather.                                                                
               Upon reviewing petitioner's bank records during the course             
          of the interview, Hensley discovered that, in addition to                   
          purchasing the Corvette for cash, petitioner had made at least              
          $50,000 in cash deposits into a bank account in 1989 and 1990.              
          Petitioner and Hensley spent the rest of the day going over his             
          records and discussing where he obtained the money to make such             
          deposits.  After Hensley perceived some inconsistencies between             
          the records and what petitioner had told her, and because she was           
          having trouble understanding petitioner, she asked petitioner to            
          provide her with a written statement explaining the                         
          discrepancies, to which he assented.  Petitioner prepared the               
          written statement after he and Hensley had discussed the fact               
          that gifts of up to $10,000 per donee were tax-free to the donor.           
          The written statement was not made under oath, and petitioner's             
          signature does not appear on it.  The written statement provided            
          as follows:                                                                 
               Cash gifts:                                                            
               Parents   Grandparent                                                  
               starting at approximately age 15 basically yearly in                   
               area of [$]5,000-10,000 (an estimate) yearly sometimes                 
               it varied from year to year--not in lump sum but over                  
               period of time.  Could be for example:  allowances,                    
               given on holidays and birthdays etc.  * * *                            




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