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commission to petitioner. None of the Holiday Isle closing
documents show that Dogwood Acres was involved in the
transaction. Neither petitioner nor Harris told Yost that
petitioner or Dogwood Acres was involved in the Holiday Isle
joint venture.
Petitioner deposited the $250,000 in his personal checking
account on September 22, 1983. Also on that day, he wrote checks
from that account for $100,000 to Dogwood Acres, $75,000 to Saudi
Corp. as a loan, and $60,000 to Valparaiso Bank & Trust Co.
Saudi Corp. paid $75,000 to Dogwood Acres in December 1983.
Thus, Dogwood Acres received $100,000 from petitioner and $75,000
from Saudi Corp.
Discussion
A. Contentions of the Parties
Petitioner contends that $175,000 of the $250,000 that he
received as a result of the Holiday Isle transaction is income to
Dogwood Acres and not to him. Petitioner contends that the
$175,000 was Dogwood Acres' share under a joint venture agreement
that it had with petitioner and Saudi Corp.
Respondent contends that the $250,000 is gross income to
petitioner and that petitioner improperly tried to avoid taxation
of the payment by assigning his income to Dogwood Acres.
Respondent contends that petitioner has not shown that a joint
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Last modified: May 25, 2011