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By May of 1955, petitioner and a relative by the name of
David Karp were working as partners in the business, and Cal Ben
was conducted as a partnership.
On September 7, 1959, Ben Schacter, David Karp, and
petitioner entered into a written partnership agreement that
provided that they would share equally as partners in the profits
and losses of Cal Ben.
On May 1, 1967, Ben Schachter retired and relinquished his
interest in Cal Ben. Thereafter, petitioner and David Karp
operated Cal Ben as equal partners, and each was entitled to 50
percent of the profits and losses of Cal Ben.
A checking account and a money market account for Cal Ben
were maintained in Cal Ben's name at Bay Bank of Commerce. The
address for the accounts at Bay Bank of Commerce apparently
reflected Cal Ben's mailing address, and all bank statements for
these accounts apparently were mailed to Cal Ben's business
mailing address.
Also, after August 8, 1977, and during the years in issue, a
bank account was maintained at Lloyds Bank California (which in
1986 was acquired by Sanwa Bank California) in the name of "C B
Co., MFG." (the Lloyds/Sanwa account). Petitioner and David Karp
were authorized signatories on the Lloyds/Sanwa account. The
address for the Lloyds/Sanwa account reflected petitioners'
residence address, and all bank statements for the Lloyds/Sanwa
account were mailed to petitioners' residence.
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