- 5 -
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