- 5 - Pursuant to the CBR lease, Omega was to furnish any machinery, equipment, water, fertilizer, chemicals, and labor to plant, grow, and harvest any and all crops. Omega was also responsible for all costs and expenses associated with the raising of livestock, including, but not limited to, fencing construction and maintenance, barn maintenance, road maintenance, and feed costs. The maximum number of livestock allowed to graze on the property was 200. Normal repairs were to be absorbed by Omega, but CBR was responsible for major repairs costing more than $2,000. Omega and CBR entered into a new leasing agreement on May 1, 1995. Only petitioner signed the new agreement between CBR and Omega as an officer of both CBR and Omega. The new agreement was similar to the previous lease with CBR; however, Omega would now pay CBR $3,000 per month for the rental of land and $1,400 per month for the rental of certain mobile homes. On its income tax returns for 1990 through 1995, Omega reported receipts and net losses from farming activity as follows: Year Receipts Net Loss 1990 -0- $39,698 1991 $2,692 163,687 1992 5,620 191,516 1993 12,938 148,268 1994 4,385 155,156 1995 185 135,239 Total 25,820 833,564 From 1990 through 1995, Omega’s receipts from its farm activity consisted of the following components:Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011