Alexander M. Moye and Judy H. Moye - Page 20

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                    Commissioner, 66 T.C. at 24-25 (corporation recognized because it                                                                                      
                    owned insurance, borrowed money, and had a checking account).                                                                                          
                              Rosewood Kennels, Inc., did considerably more than the                                                                                       
                    corporations in Paymer and Strong.  Rosewood Kennels, Inc., owned                                                                                      
                    26 acres of land which it used as collateral.  It borrowed                                                                                             
                    $500,000.  It applied for and obtained insurance policies.  It                                                                                         
                    sent its customers invoices which showed that it sold equipment                                                                                        
                    and provided services to them in 1990.                                                                                                                 
                              Petitioners contend that Rosewood Kennels, Inc., did not                                                                                     
                    engage in business in 1990.  We disagree.  A significant amount                                                                                        
                    of documentary evidence contradicts their testimony.                                                                                                   
                              2.        Cases Cited by Petitioners                                                                                                         
                              Petitioners contend that we should disregard their                                                                                           
                    corporation just as we did the corporations in Blue Flame Gas Co.                                                                                      
                    v. Commissioner, 54 T.C. 584 (1970); Barker v. Commissioner, T.C.                                                                                      
                    Memo. 1993-280; and Bystry v. United States, 596 F. Supp. 574                                                                                          
                    (W.D. Wis. 1984).  We disagree.                                                                                                                        
                              The taxpayers in Blue Flame Gas Co. v. Commissioner, supra,                                                                                  
                    had a partnership when they filed articles of incorporation.                                                                                           
                    They contributed no property to the corporation.  The corporation                                                                                      
                    did no business and was abandoned.  We held that the losses at                                                                                         
                    issue were attributable to the partnership.  Id. at 599.  In                                                                                           
                    Barker v. Commissioner, supra, we held that the business should                                                                                        
                    not be taxed as a corporation because it lacked assets and had no                                                                                      

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