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taxed to its true earner, Commissioner v. Culbertson, supra at
739-740; Lucas v. Earl, 281 U.S. 111, 114-115 (1930), and a
validly organized and operated corporation's existence must be
recognized for tax purposes, Moline Properties, Inc. v.
Commissioner, 319 U.S. 436, 438-439 (1943)--a determination of
the true earner requires a more refined inquiry than merely
pointing to the actual performer of the services. Johnson v.
Commissioner, 78 T.C. 882, 890-891 (1982), affd. without
published opinion 734 F.2d 20 (9th Cir. 1984). Instead, we must
determine, as between the corporation and its service-performing
agent or shareholder, who controls the earning of the income.
Id. at 891, and cases cited therein. A two-part test must be
satisfied before the corporation, rather than its service-
performing agent or shareholder, will be considered to control
the earning of the income. First, the service provider must be
the employee of the corporation, whom the corporation has the
right to direct and control in some meaningful sense. Second,
there must exist between the corporation and the service
recipient a contract or similar indicium recognizing the
corporation's controlling position. Haag v. Commissioner, 88
T.C. 604, 611 (1987), affd. without published opinion 855 F.2d
855 (8th Cir. 1988); Johnson v. Commissioner, supra at 891; see
also Leavell v. Commissioner, 104 T.C. 140, 151-152 (1995).
On the basis of the evidence in this case, we do not believe
that petitioners can meet either component of the test. First,
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