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In 1986, $100,000 of TMT funds were used to purchase land
described in the TMT general Ledger as "St. Francis Arkansas -
Land." The cost of this land was $100,000. In 1987, this
property was transferred to Ballard. Book entries were made to
reflect this transaction. "Loans" to Ballard were increased by
$100,000. The land was no longer reflected as a TMT asset. The
adjusting journal entry that went with the transfer to Ballard
described the property as the "Fairfield Planting Company".
This "loan" has never been repaid. In 1987, TMT paid an
additional $20,344 for the Fairfield property, which amount was
treated as an additional loan to Ballard.
The Fairfield Planting Co. is an S corporation which owned
the Fairfield Plantation, a farm in Arkansas. The income and
loss from the Fairfield Plantation Co. were reported on Ballard's
1987, 1988, and 1989 returns.
At the time of trial of these cases, TMT owned the following
farms or other entities: Ashland Plantation in Mississippi,
Fairfield in Arkansas, and Loch Leven in Mississippi. The
Ballards referred to the Loch Leven farm as "our big farm."
According to Mary Ballard, TMT, at one time, had been involved
with Lock Leven, but it was owned by the Ballards.
Mrs. Ballard did not know who owned the stock of TMT. She
referred to TMT as her husband's business.
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