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problems. During the years at issue, his work on the farm
consisted largely of riding a tractor or baling hay no more than
a few times a week. Ione Zachman did not participate in the farm
work, apart from growing her own garden. Both before and after
the creation of Hillside Farm, petitioners’ sons, Dale and Paul,
performed most of the farm work. Dale made most of the farming
decisions. Dale and Paul each received weekly wages for their
labors.
All the gross receipts from petitioners’ farming operation
were sent to Joan Noske at a post office box in Cold Springs,
Minnesota. Joan Noske generally made provision out of “Hillside
Farm” funds for paying farm expenses, as well as certain of
petitioners’ personal expenses, including insurance, medical
bills, income taxes, and property taxes on petitioners’
residence.
During the years at issue, Joan Noske did all the
bookkeeping for Hillside Farm. She prepared the Federal income
tax returns for Hillside Farm and at least 20 other trusts that
name Armageddon and Parnell as trustees. She also prepared
petitioners’ Federal income tax returns for the years in issue.
At least twice a year, petitioners received ledgers from Joan
Noske which accounted for funds purportedly received and
disbursed by Hillside Farm during the years at issue. The
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Last modified: May 25, 2011