Bernardus A. P. Dobbe and Klazina W. Dobbe - Page 4




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          years at issue, Mr. Dobbe was the president of Holland America,             
          and Mrs. Dobbe was the vice president, treasurer, and secretary             
          of Holland America.  Holland America used the accrual method of             
          accounting and a fiscal year ended September 30 for all relevant            
          years.                                                                      
          1066 South Pekin Road                                                       
               Mr. and Mrs. Dobbe have owned the property located at 1066             
          South Pekin Road since approximately 1981.  The property consists           
          mostly of cropland but also includes some noncropland on which              
          warehouses, a shed for storing machinery, various greenhouses,              
          and Mr. and Mrs. Dobbe’s personal residence are located.  Holland           
          America’s main office is attached to the side of the Dobbe                  
          residence.  The office and the residence share a common driveway.           
          During 1993, Mr. and Mrs. Dobbe and their children lived in the             
          residence year round.                                                       
               From 1989 through September 30, 1991, two separate annual              
          written leases were in effect.  The “Building Lease Agreement”              
          leased “that certain warehouse and shed” to Holland America “for            
          the purpose of packaging, storing and maintaining bulbs and cut             
          flowers, and maintaining equipment” for $3,500 per month.  The              
          “Lease of Crop Land” leased the cropland for horticulture                   
          purposes for $5,200 per month.  From October 1, 1991, through               
          September 30, 1993, a comprehensive annual written lease replaced           
          the separate leases, but the categories of property covered by              






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Last modified: May 25, 2011