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business purpose, intended to form a partnership. Commissioner
v. Culbertson, 337 U.S. 733 (1949).
We find that Elizabeth and Birnie did not intend to form a
partnership but intended to share their incomes and property much
as a married couple might. References to a business partnership
in certain documents as well as in some of the testimony
presented at trial appears to be a loose description of the
sisters' arrangement rather than an attempt to define the
arrangement in legal terms. We find Ms. Childs' description of
the arrangement to be accurate when she stated: “They had no
written articles of partnership, no written agreements, it's just
the way you did things. Just as if someone in this room and I
were to open an account and each put $5,000 in it and decide to
invest it, we would just rock along and we'd each report our half
of the gains and losses and that sort of thing.” Elizabeth and
Birnie were not engaged in a “trade, business, or profession.”
Although they combined their incomes into joint accounts and
purchased various stocks, this merely amounted to co-ownership of
the various accounts and stock. The evidence fails to support a
conclusion that the sisters had a business relationship. On her
1980 Federal income tax return, Birnie reported dividends from
only three companies in the amounts of $12,391, $48,300, and
$1,350 and from the Estate of Elizabeth Davenport in the amount
of $4,269. Additionally, on her 1980 return, Birnie only
reported long-term capital gains from the sale of three different
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