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properly included in the jury instructions in petitioner’s
criminal case).
For reasons discussed next, we do not recognize the 13
corporations for Federal income tax purposes. Petitioner used
false EINs when forming the corporations. The 13 corporations
did not follow any corporate formalities such as maintaining
books and records, issuing stock, holding annual meetings,
electing officers, or issuing financial statements. They did not
have employees, they paid no salaries or dividends, and they did
not conduct any legitimate business. They did not file tax
returns. Petitioner did not treat the 13 corporations as
separate business entities. He often lent money from one
corporate account and deposited repayments for that loan in other
corporate accounts.
Petitioner contends that the 13 corporations provided tax
preparation, money lending, and check cashing services. We
disagree. There are no documents in evidence that show there
were any business transactions between a client and any of the
corporations. No checks payable to any of the 13 corporations
were produced at trial. Petitioner’s clients made checks for
services payable to petitioner, H. Wapnick & Sons, or cash.
Petitioner testified and contends that he did not own all of
the stock of the 13 corporations. He contends that John Wapnick
and Seth Wapnick bought Centurion Taxi, Inc., at the end of 1987;
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