- 29 -
depends on the facts of each case. See Hardin v. United
States, 461 F.2d 865, 872 (5th Cir. 1972).
In these cases, respondent argues that, as the sole
and controlling shareholders of Crabtree Investments,
petitioners “exercised the requisite substantial influence
to be taxable on these amounts.” Petitioners’ only
argument is that they could not have received constructive
dividends from Crabtree Investments because the corporation
did not receive the unreported income determined by
respondent.
As discussed earlier in this opinion, we find that
Crabtree Investments received unreported income during
1992, 1993, and 1994 in the amounts determined by
respondent. Thus, we reject the sole argument that
Ms. Jerry Crabtree and Mr. Eddie Crabtree did not receive
constructive dividends from Crabtree Investments because
the corporation had not received any unreported income.
Accordingly, we sustain respondent’s determination that
Ms. Jerry Crabtree and Mr. Eddie Crabtree received
dividends in the amounts set forth in the subject notices
of deficiency.
Page: Previous 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 NextLast modified: May 25, 2011