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supporting a tax deduction for that year. Both he and Mr. Petar
had believed that payment by check within 2-1/2 months, as
planned, would be sufficient for that purpose. In Mr. Cunniff’s
view, it was just a fortunate coincidence that petitioner issued
the Note in time to qualify for a deduction for FYE 5/31/90.
The Witness: * * * The note came about because back
in, I don’t know when, it was -- I think it was tax
season still * * * Mr. Petar needed some bonding, okay,
performance bonds, because he has his own personal land
over there that he was going to put a project in on.
What happened is that we met sometime early in May when
we did this. At the time Frank told me he needed a
financial statement, his personal financial statement,
because of the bonding company. I think it was Aetna
or whatever. Okay.
So I made him up a personal statement. On the
statement I showed a receivable on his asset statement
of $100,000. Frank and I talked, and when this
occurred, Frank had called me and said after I gave him
this statement that we should show something in the way
of substantiating this because -- I guess -- I have
never gone through bonding myself but I guess they ask
you everything on your thing, they want to know, you
know, where this came from and everything.
* * * * * * *
* * * we drafted up this note just for something to
send with this financial statement to show that there
was a $100,000 asset that was actually due and payable
to Frank very shortly.
* * * * * * *
The Court: Now why would Mr. Petar get personal
bonding if he was doing business as the corporation?
The Witness: Because this is -- this is personal
property that he owned. This wasn’t land in the
corporation.
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