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Respondent emphasized the fact that certain partnership
formalities, including a written partnership agreement, were not
present in this case. We do not find the absence of such
formalities to be fatal to the existence of a partnership. As
the Supreme Court stated in Commissioner v. Culbertson, supra at
744-745:
If, upon a consideration of all the facts, it is found
that the partners joined together in good faith to
conduct a business, having agreed that the services or
capital to be contributed presently by each is of such
value to the partnership that the contributor should
participate in the distribution of profits, that is
sufficient. * * *
See also Estate of Winkler v. Commissioner, supra.
Respondent argues that even if the rental real estate
activities constitute a partnership for Federal income tax
purposes, the record does not contain sufficient evidence to
support a determination of petitioner's basis in his partnership
interest at the end of 1992. We disagree. The amount paid for
the Oak Street properties is in the record. Furthermore, the
Pughs, petitioner's partners, were able to prepare their 1992
Federal income tax return reporting income and expenses from the
Oak Street properties.
Petitioner asserts that in addition to all stipulated
expenses and adjustments, he is entitled to deduct 50 percent of
the partnership expenses incurred during 1992 in the following
amounts:
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