- 3 - FINDINGS OF FACT The parties’ stipulation of facts and the exhibits are incorporated herein by this reference. Petitioners J. Michael and Marita Shedd (the Shedds) are husband and wife and resided in Livonia, Michigan, at the time their petition was filed. The Shedds each owned 50 percent of J&J, whose principal place of business was Romulus, Michigan, at the time its petition was filed. J&J was engaged in the freight forwarding business in the Detroit, Michigan, metropolitan area. Mr. Shedd owned 100 percent of TLC, which was engaged in a freight forwarding business in Cleveland, Ohio. J&J and TLC are related due to Mr. Shedd’s stock ownership. J&J began operating in June 1988, and Mrs. Shedd maintained its books without receiving compensation. Mr. Shedd was president of J&J. J&J did not declare or pay any dividends. J&J was the first of the Shedds’ companies to become involved in a network of independent freight forwarding contractors named SEKO. Payments were made by freight customers to SEKO, which retained 40 percent of adjusted revenues and remitted the balance to the contractors. SEKO also retained the right to apply customer receipts to outstanding indebtedness and was entitled to maintain contractor security deposits. Under its agreement with SEKO, J&J’s shareholders were required toPage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 Next
Last modified: May 25, 2011