Zabetti A. Pappas - Page 25

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          falls short of showing actual business activity by the                      
          corporation.  Nor is such activity reflected in petitioner’s                
          practice of having salespeople and customers use the name “Real             
          Services” when they executed sales slips and checks to                      
          petitioner.  The fact remains that no one who dealt with                    
          petitioner did so with any reliance upon the business probity or            
          solvency of Real Services.  To the extent that anyone acquiesced            
          in petitioner’s employment of the name “Real Services”, they did            
          so with the understanding that they were doing business with her,           
          and not with a corporation.4                                                
               We conclude that Real Services functioned merely as an alter           
          ego of petitioner and is therefore a sham corporation.  As a                
          result, we disregard the existence of Real Services for purposes            
          of Federal taxation; the income at issue is properly taxed to               
          petitioner individually.                                                    
          II.  Whether Petitioner Had Unreported Income From an Escort                
          Business in 1989 and 1990                                                   
               Petitioner operated an escort business as previously                   
          described during 1989 and 1990.  Although she denies involvement            
          with the escort business, and with the receipt of income from               

               4 In this regard, petitioner argues that the dealings of               
          Real Services involved making payments to a puppeteer.  In                  
          support she cites an exhibit that was not introduced into                   
          evidence.  She has made similar citations throughout her briefs.            
          These documents are not part of the record and have not been                
          considered in making our decision herein.  Rule 143; see                    
          Eickmeyer v. Commissioner, 66 T.C. 109, 110 n.3 (1976).                     

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