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Accordingly, we conclude that the average period of use by
Hairston of petitioners’ equipment exceeded 30 days. On this
score alone, petitioners fail to satisfy the requirements of the
first exception described above.
Moreover, the evidence does not establish that petitioners
in their individual capacities provided either significant or
extraordinary personal services in connection with making their
equipment available for use either by petitioners’ customer
(namely, Hairston) or for use by Hairston’s customers under the
subleases. Under the terms of the lease agreement between
petitioners and Hairston, petitioners individually had little or
no responsibility for upkeep and maintenance of the equipment.
Rather, Hairston assumed “all responsibility” for the equipment.
The services of petitioners as officers and employees of
Hairston in maintaining all of the equipment and in handling
subleases of the equipment to end users do not qualify as
services of petitioners (or as services rendered on behalf of
petitioners) as owners of the equipment. Under the lease
agreement with Hairston, petitioners were not obligated as owners
of the equipment to provide any services to Hairston or end
users. Any services that petitioners might have performed as
Hairston officers or employees were unrelated to petitioners’
obligations as owners of the equipment.
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Last modified: May 25, 2011