- 6 - C. Analysis 1. Issue The issue is whether the interest payments that were credited to the Aldergrove account in the amounts of $116,000, $84,700, and $140.66 (the 1991 interest payments), are taxable to petitioners (the 1991 interest issue). 2. Arguments of the Parties Petitioners argue that Mr. Bell and his wholly owned corporations provided the financing that allowed Chestnut Grove and Group M to acquire the Yakima property. Petitioners argue that the checks in the amounts of $116,000 and $84,700, both made payable to Ihatsu Fudosan or Aldergrove (the Yakima interest payments), represent interest payments to Mr. Bell for the Yakima property loans and were held in trust for Mr. Bell by Aldergrove until those funds were transferred to a Bank of Bermuda account over which petitioner did not exercise any control, and, therefore, Mr. Bell is taxable on those payments, “regardless of whether Aldergrove Investments Co. was Petitioner's alter ego.” Alternatively, petitioners argue that petitioner lacked sufficient dominion and control over the Aldergrove account to be taxable on the 1991 interest payments. Petitioners argue thatPage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
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