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certificate transactions, as Randy would need to obtain the
registration paper rights held by certain partnerships on
particular male sheep he contemplated selling later that year at
various annual shows.
Mr. Hoyt specifically testified that RCR #4, on its 1989 or
1990 return, reported $260,000 of income from its sales of
breeding value certificates, and that RCR #6, on one of its later
returns, reported about $500,000 of income from its sale of
breeding value certificates. He stated the certificate proceeds
were applied against the first principal payments that RCR #4 and
RCR #6 each owed to Barnes Ranches under their respective
"recourse promissory notes". He added that up to that point, the
partnerships had not been reporting annually the income from
their sales of breeding value certificates. Thus, the respective
$260,000 or $500,000 of income that each partnership reported,
for its fifth or sixth year of operation, also included some
accumulated income each partnership had derived in prior years
from selling breeding value certificates.
Although Randy did state that he and Mr. Hoyt, over the
years, had negotiated the Barnes family's purchase of breeding
value certificates held by the eight partnerships (excluding OGT
90, which petitioners contend did not enter into a transaction
with Barnes Ranches), his testimony differed from and
contradicted that of Mr. Hoyt's in important respects. Randy
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