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to Ms. Carvin. At the time Mr. Moore prepared petitioners' tax
return, he believed that the bad debt deduction was valid.
However, he did advise petitioner about certain tax risks
associated with the deduction.
Ms. Carvin is a high school graduate and has no special
training in business, accounting, or finance. She met petitioner
while working as a receptionist for Fairfield Communities in the
early 1970's. They married in 1974. Sometimes Ms. Carvin worked
outside the home in various jobs. She was the president of
Architectural Antiques, Inc., a company wholly owned by
petitioners. She did not run the day-to-day operations or make
financial decisions for the company. After the birth of
petitioners' daughter in 1985, Ms. Carvin became even less
involved in the antique business and rarely, if ever, went to its
place of business. Ms. Carvin attended antique shows and
auctions with petitioner, but petitioner purchased most of the
antiques. Architectural Antiques ceased business in 1989, and
the antique inventory was sold to pay petitioner's bank
obligations.
Ms. Carvin was not involved in the operation or management
of BEI, TELCOR, or their subsidiaries. Petitioner did not
discuss his business dealings with Ms. Carvin or answer questions
that Ms. Carvin asked about the business. Ms. Carvin was not
aware of the amount of petitioner's advances to BEI and TELCOR or
that the ENSCO stock was used as collateral to obtain loans for
BEI and TELCOR. Ms. Carvin did not know the number of businesses
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