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1990, Granot Loma’s caretaker and his wife experimented with some
maple syrup equipment they found on the property to tap some of
the maple trees growing on the property and process the sap into
syrup. They ceased the experiment, however, after the
caretaker’s wife received burns as a result of their activity.
In February 1989, petitioner hired Joseph Ketter as
caretaker and property manager for Granot Loma. When Mr. Ketter
was hired, he was informed that petitioner intended to use Granot
Loma as a business retreat. At some point after he was hired,
Mr. Ketter was instructed to issue an invoice in LFI’s name to
one of petitioner’s other corporations each time petitioners, a
member of their family, or one of their friends, business
associates, or guests visited Granot Loma. For example, the
first invoice for $420, dated March 7, 1989, was addressed to BAC
and covered three nights for two pilots at a rate of $70 per
person per night. Another invoice, dated August 9, 1989, for
$5,530 was addressed to BCC, reflecting the overnight stays of
petitioner’s employees during the 1989 employee weekend, at the
same rate. One invoice for $123,285, dated April 23, 1990,6 was
addressed to BCC and retroactively billed BCC for visits by
petitioner, his family, and their guests during 1988, 1989, and
6Petitioner’s accountant, Mr. DiMaggio, was first contacted
by a representative of the Internal Revenue Service regarding the
examination at issue in this case in April 1990.
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