Quantum Company Trust - Page 5




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               Total deposits                          $2,356,263.15                  
          Less:                                                                       
               Fishing income                $25,084.19                               
               Loans from family             86,155.52                                
               Nontaxable transfers          144,011.70                               
               Nontaxable deposits           867,697.92                               
               Nontaxable estate             81.25                                    
               Quantum Trust income         28,000.00                                 
                                                             1,151,030.58            
          Gross receipts                                11,205,232.57                 
              1   The parties stipulated that Northridge’s gross receipts            
          should be increased by $28,000, representing Quantum Co. Trust’s            
          income for 1993.                                                            
               Respondent maintains that Northridge’s 1993 gross receipts are         
          $86,155 greater than determined by Mrs. Crockett.  Specifically,            
          respondent disputes the Nortons’ claim that $86,155 of the NBA              
          deposits represents nontaxable loans from Mr. Norton’s brother, a           
          friend, and family members.  We thus must determine the source              
          (loans vs. gross receipts) of the $86,155 deposit.                          
               The characterization of the $86,155 depends upon our accepting         
          the testimony of Mr. Norton as truthful.  Mr. Norton testified that         
          he and his wife emerged from bankruptcy in 1993, and to alleviate           
          their financial burden, they borrowed moneys from Mr. Norton’s              
          brother (Steve), a friend (Jim Sullivan), and unnamed family                
          members.  According to Mr. Norton, he and his wife agreed to repay          
          the loans with 8 percent interest.  No notes or collateral were             
          given.                                                                      








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Last modified: May 25, 2011