- 3 - upon commencement of his employment, petitioner received $103,000 as a loan from Dean Witter. As reflected in a promissory note signed by petitioner, beginning in 1989 this loan was to be repaid by petitioner in three annual installments of approximately $34,333 each, plus 10-percent annual interest, for a total annual payment due of $37,767. Under the terms of the loan agreement, as long as petitioner worked for Dean Witter during 1989 through 1991, petitioner would receive a yearend bonus in the amount of $37,767, which petitioner was required to return to Dean Witter, via a personal check, in order to cover the annual $37,767 payment due on the $103,000 loan from Dean Witter. Of the $37,767 annual payment due, $3,433 reflected interest due on the loan. On his 1988 Federal income tax return, petitioner did not report the $103,000 loan proceeds received as income. For 1988, Dean Witter also apparently treated the $103,000 as a loan to petitioner. For 1989 and 1990, the record does not indicate how petitioner and Dean Witter treated the $37,767 yearend bonuses received by petitioner. For 1991, Dean Witter included the $37,767 yearend bonus paid to petitioner in the "wages" portion of the Form W-2 that it issued to petitioner for 1991. On August 2, 1991, petitioner filed for bankruptcy. Petitioner's bankruptcy proceedings were closed on December 23, 1991.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Next
Last modified: May 25, 2011