John F. Daugharty and Sarah R. Daugharty - Page 1

                                        T.C. Memo. 1997-349                                              


                                      UNITED STATES TAX COURT                                            


                 JOHN F. DAUGHARTY AND SARAH R. DAUGHARTY, Petitioners v.                                
                         COMMISSIONER OF INTERNAL REVENUE, Respondent                                    
                        FAYE E. DAUGHARTY, Petitioner v. COMMISSIONER                                    
                                 OF INTERNAL REVENUE, Respondent                                         


                  Docket Nos. 6023-95, 6280-95.           Filed July 29, 1997.                           


                  James D. O'Donnell and John W. West, III, for petitioners                              
            John F. and Sarah R. Daugharty.                                                              
                  Kenneth G. Anderson, James P. Stevens, and John Callender                              
            (specially recognized), for petitioner Faye E. Daugharty.                                    
                  Willie Fortenberry, Jr., for respondent.                                               


                            MEMORANDUM FINDINGS OF FACT AND OPINION                                      







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