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petition was filed. Petitioner Eddy Ben Cordes was a resident of
Lawton, Oklahoma, at the time his petition was filed. Each of
the individual petitioners was a cash basis, calendar-year
taxpayer. The Cordeses are the parents of petitioners John
Cordes, Jean Ann Richard, and Eddy Ben Cordes. We shall
hereinafter refer to the above-named petitioners collectively as
the Cordes family.
CFC was incorporated in Oklahoma on January 24, 1964.
CFC’s principal place of business was in Lawton, Oklahoma, at the
time its petitions were filed.
B. The Cordes Corporations
During the taxable years at issue, members of the Cordes
family held legal title to all the shares of stock in the
following closely held corporations:6 CFC,7 Eddie Cordes, Inc.,
Edmund Cordes, Inc., and John Cordes, Inc. (collectively, the
Cordes corporations). The primary business activity of each of
6It appears from the record that members of the Cordes
family have held legal title to all, or nearly all, of the shares
of stock in CFC, Eddie Cordes, Inc., Edmund Cordes, Inc., and
John Cordes, Inc. (collectively, the Cordes corporations), since
their respective incorporations.
7In 1971, CFC issued 500 shares of stock, 105 of which were
issued to Eddy Ben Cordes. The record does not indicate who
became the recordholder of the other 395 shares. The record does
indicate that, in 1988, Ellen Cordes, Mr. Cordes’s daughter-in-
law, held legal title to 100 shares which she transferred to Jean
Ann Richard later that year. The testimony and exhibits confirm
that members of the Cordes family held legal title to all
outstanding stock in the Cordes corporations during the taxable
years at issue.
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