-5-
Hancock Enterprises sometimes held back (i.e., did not sell) some
lots that were harder to sell from each subdivision.
3. Accountants and Bookkeeper
Toback & Co., C.P.A.'s (Toback), were the accountants for
Hancock Enterprises. John J. Gorman, Jr. (Gorman), began
handling the Hancock Enterprises account in 1981. Toback
prepared all of the Hancock Enterprises returns from 1973 to 1986
and prepared petitioner's individual tax returns from 1987 to
1994. Petitioner worked closely with Toback's accountants,
including Gorman. She met with Gorman nearly monthly from 1981
to 1985. Her husband met with Gorman once or twice from 1981
until he died in December 1985.
Hancock Enterprises stopped building houses in 1982 or 1983
and began selling its lots because interest rates were 18 and 19
percent. It laid off its superintendents, foremen, and
architects. Hancock Enterprises had about 115 lots when it
stopped building homes.
4. Building Industry in Phoenix
The homebuilding market in Phoenix peaked around 1984-86.
The number of building permits issued in Phoenix declined from
then until 1990. Residential real estate prices also declined
after 1986. High interest rates caused some buyers to abandon
their deposits on lots. Hancock Enterprises' buyers canceled
contracts for three lots in the Summer Shadows subdivision
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Last modified: May 25, 2011