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verifiable corporate actions. The controlling shareholder’s
thought processes or informal oral statements to an outside
accountant, which are not timely acted upon and are not timely
reflected in the corporation’s books and records, do not
constitute verifiable corporate actions. See Lombard & Co. v.
Commissioner, T.C. Memo. 1979-297 (“in the absence of any
written memoranda, corporate minutes, resolution, or a crediting
upon the corporation's books of the amount of salary, we cannot
say that Franklin's salary was credited or set aside so as to be
constructively received”).
Petitioner’s reliance on Miller-Dunn v. Commissioner,
supra, is also misplaced. Miller-Dunn was a reasonable
compensation case, not a constructive receipt case. The Court
held that amounts actually paid by the corporation during the
fiscal year constituted reasonable compensation for prior
services, even though no corporate resolution awarding such
compensation had been enacted. The Miller-Dunn case does not
consider a timing issue like the one in the case at hand.
The preceding analysis shows that neither Doyce Gentry nor
his sons had the right to receive or take the income prior to
the end of petitioner’s fiscal year. In addition, unlike Mr.
Gentry, who had sole check-writing authority over petitioner’s
accounts, the sons did not have the power to obtain payment
prior to the close of petitioner’s fiscal year. We therefore
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