James E. and Chung H. Peacock - Page 5

                                         -5-                                          
          B.   Petitioners' Family                                                    
               1.   Petitioner-Husband's Parents                                      
               Wilma MacFarland and Tobey Peacock were petitioner-husband's           
          parents.  They were divorced before June 1957.  In June 1957,               
          Wilma MacFarland married Winston MacFarland (MacFarland).  Wilma            
          and MacFarland were divorced in 1973.  Wilma MacFarland died in             
          1979.                                                                       
               Wilma MacFarland lived in a mobile home.  When she and                 
          MacFarland were divorced in 1973, she had almost no assets.                 
          MacFarland was required by court order to make support payments             
          to her of $150 a month.  Wilma MacFarland reported no wage or               
          self-employment income on her tax returns for tax years 1968 to             
          1979.  She reported less than $28,500 as wages or self-employment           
          income during her life and never more than $3,600 in any one                
          year.                                                                       
               MacFarland had almost no assets when he and Wilma MacFarland           
          were divorced in 1973.  After 1973, MacFarland never earned more            
          than $11,439 a year.  After 1978, he reported no wage or self-              
          employment income on his income tax returns.  From 1980 until the           
          mid-1980's, MacFarland worked as an apartment manager for                   
          petitioner-husband in exchange for free rent.  MacFarland used              
          his income from social security to pay his expenses.  He was                
          careful not to spend more than the amount of his Social Security            
          checks.  Petitioner-husband sometimes gave MacFarland small                 
          amounts of money.  In the mid-1980's, MacFarland moved into a               




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