William N. and Moira M. Carlstedt - Page 8

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                  Monaghan Leasing Co.                                                                   
                  Monaghan is a leasing corporation owned by petitioner and                              
            Dickman; petitioner was its president.  Monaghan acquires                                    
            construction and other equipment and leases it to CDI and the                                
            other enterprises.  Monaghan had no employees in 1990 and 1991.                              
                  Throughout the years at issue, the offices of CDI and                                  
            petitioner's other businesses were all located in a single office                            
            suite at Allison Pointe, in one of the buildings owned by the                                
            partnerships.  Petitioner occupied one office in this suite from                             
            which he conducted all of his business activities.  Petitioner                               
            stated that "if you walked into our office there wouldn't be                                 
            divisions between each of these companies and it would be                                    
            difficult for you to tell who worked for who".  The businesses                               
            all shared the same phone lines.  Rent was allocated among the                               
            businesses based on a square-foot analysis of the space each                                 
            business utilized.  None of the cost of the space, however, was                              
            allocated to the partnerships.                                                               
                  Expenses for all of the above-described entities were                                  
            generally paid through CDI.  This was viewed as the most                                     
            efficient way to handle accounting and invoicing for the entities                            
            collectively.  Expenses were then generally allocated to a                                   
            specific company or partnership by CDI's accounting department.                              









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