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ipated in operating those companies. During those years, Amuke
Group, which had an undisclosed relationship with an entity known
as America-Ukraine Professional Business Association and Chamber
of Commerce (Amuke Business Association), engaged in various
activities relating to the purchase of certain merchandise and
the sale of such merchandise to customers located in the former
Soviet Union. (We shall refer collectively to Amuke Group and
Amuke Business Association as the Amuke organizations.)
During 1992 and 1993, petitioner engaged in certain income-
producing activities with the Amuke organizations, which con-
sisted of petitioner’s locating for those organizations certain
merchandise that they believed they would be able to sell at a
profit to their customers. In general, if petitioner located
certain merchandise that the Amuke organizations wanted to
purchase for resale, they advanced petitioner the funds to
acquire that merchandise. Over the course of their business
relationship, petitioner located, and the Amuke organizations
purchased, various kinds of merchandise such as sweatshirts,
water filters, candies, lighters, men’s suits, and canned fruit.
The Amuke organizations compensated petitioner for locating
certain merchandise on their behalf by paying him a portion of
the profit from the resale of such merchandise. Petitioner
received Form 1099, Miscellaneous Income (Form 1099), from Amuke
Group for 1992. That form showed that petitioner received from
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