George R. and Barbara H. Burrus - Page 6

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          Hereford cattle breeding undertaking principally at the Cheatham            
          Property and at certain other real property owned or controlled             
          by petitioners, referred to as the Maple Row Hereford Ranch                 
          (Maple Row).  It is this undertaking that is at issue in this               
          case.  During the years in issue, the undertaking consisted                 
          primarily of breeding and selling registered horned Hereford                
          cattle.2  Dr. Burrus employed “natural selection” in the cattle             
          breeding operations at Maple Row rather than the embryo transfer            
          technique employed by FBHR, because he believed the former was              
          more cost effective.                                                        
               As noted, the Cheatham Property was the principal location             
          for the Maple Row cattle undertaking.  Petitioners also used two            
          additional properties in Maple Row’s operations, in that cattle             
          were transported to those properties to graze during the years in           
          issue.  One such property was located in or near the town of                
          White House, in Robertson County, Tennessee (Robertson Property),           
          and the other was located in or near the town of Hendersonville,            
          in Sumner County, Tennessee (Sumner Property).3  The Robertson              


               2 Petitioners also purchased steer for fattening during                
          certain years, sold bull semen, and received income from leasing            
          the tobacco allotments for the Maple Row land.                              
               3 From 1979 through 1989, petitioners undertook farming                
          operations on the Robertson and the Sumner Properties that                  
          included running steer to eat the grass, selling crops, and                 
          leasing tobacco allotments.  Petitioners also generated income by           
                                                             (continued...)           




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