Curtis R. and Lynn Bitker - Page 28

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          partners of the Bitker partnership for the entire year.  Moreover,          
          petitioner wives each reported (on their respective individual              
          income tax returns) 20 percent of the partnership income and                
          deductions for 1991.  The 1991 Schedules K-1 do not accurately              
          reflect the partners’ capital accounts--the beginning year negative         
          capital accounts shown on petitioner husbands’ Schedules K-1                
          reflect their 50-percent interests before gifts to their wives, not         
          their 30-percent interests following the gifts.  Moreover, the              
          reported contributions from petitioner husbands to the Bitker               
          partnership, as well as the distributions to petitioner wives were          
          erroneous--the numbers used were “plugged in” in by Mr. Mostoller           
          to account for the changes in ownership.  Mr. Mostoller’s approach          
          to reporting the partners’ capital accounts, contributions, and             
          distributions for 1991 was not correct.  The partners’ capital              
          accounts for 1991 are more accurately reflected as follows:                 

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