Victor M. Bello - Page 8




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          A", converting the structure into an apartment/hotel building               
          containing 56 condominium units.  Petitioner was to receive seven           
          of those units, and retain ownership of the existing 12-cabana              
          complex.                                                                    
               In a later addendum to their 1993 settlement agreement, the            
          construction company agreed to build a house for petitioner.  The           
          house would have a value of $100,000 and would be located on one            
          of petitioner’s other Flamingo Beaches lots.                                
               On his income tax returns for 1992 through 1995, petitioner            
          claimed business deductions (some of which are in issue in the              
          instant case) with respect to his Villa del Mar venture for the             
          following specified expenses:                                               
                                   1992          1993     1994       1995             
               Depreciation          $2,353    $2,210   $2,210     $2,039             
          Mortgage interest       –-        –-       -–        7,200                  
          Other interest         8,100    10,800   12,111       --                    
               Legal, professional   65,750    52,500     –-          560             
          services                                                                    
               Supplies       154       215     –-         –-                         
          Taxes                 18,000    18,000    2,000       –-                    
               Travel                 3,493     4,912     –-         –-               
          Wages                 48,880      –-       -–         –-                    
               Funding fee           25,000      –-       –-         –-               
               Legal, professional     –-        -–       –-      100,000             
          & mgt. fees                                                                 
          Security              12,000    12,000   12,000       –-                    
          Telephone               –-        –-        454       –-                    

               In 1999, petitioner and Ms. Oliveira reopened the 12-cabana            
          complex for business as a bed-and-breakfast establishment.                  








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