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FINDINGS OF FACT
Some of the facts have been stipulated and are so found.
The stipulation of facts is incorporated herein by this
reference. Petitioners resided in Potomac, Maryland, at the time
they filed their petition.
During 1986, 1987, and 1988, Mr. Bach worked as a real
estate broker for a business known as ISI Real Estate Co., which
was owned in part by petitioners.3 In addition, Mr. Bach was
also the sole shareholder of Investment Syndications, Inc. (ISI),
which was incorporated in May 1981. During the same years, Ms.
Bach worked as an accountant for RMR & Associates, Inc.
As of January 1, 1987, Mr. Bach was a general partner of
America/Bradley Limited Partnership (America/Bradley). The
principal business of America/Bradley was real estate
construction. Mr. Bach owned a 22.5-percent interest in
America/Bradley and had a deficit capital account balance of
$448,756 as of January 1, 1987. The total of all America/Bradley
partners' capital accounts decreased from a deficit of $996,674
at the beginning of 1987 to a deficit of $2,853,708 at the end of
1987. During 1987, Mr. Bach assigned his entire interest in
3Petitioners conducted their real estate business under the
name of ISI Real Estate Co. and represented on their 1987
Schedule C that Ms. Bach owned 60 percent of the business and Mr.
Bach owned 10 percent of the business. The ownership of the
remaining 30 percent of ISI Real Estate Co. is unclear from the
record.
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