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A Oh, like the downpayment at closing.
Q Right.
A Same thing.
Q Did you use Miles--any of the money in Miles’s
trust account at times to attempt to make purchases of
property?
A Oh, yes.
Q And did you think that that caused you to have to
declare that as income when you made the purchase
through Miles?
A No, sir.
Q Why not?
A Again, I had this. I thought, an understanding of
what a tax-free exchange was, and I don’t think in this
game you have to be off very much. But apparently I
was off a little bit on this.
Q Well, what was your understanding in the years at
issue--1985, ‘-6, ‘-7, and ‘8, as to how this tax-free
exchange worked in relation to your tax liability?
A Okay. It’s hard to divorce myself from what I
think today and what I thought today--is that, you
could sell a piece of property, the money goes into
escrow, and you take that money and buy another piece
of property, and if you don’t--again, I refer to it as,
take it out and spend it on wine, women, and song--
Q By that, you mean--
A --that is reinvestment.
Q By that phrase--wine, women, and song--you mean
take it out for yourself, for living.
A Yes, sir.
Q And if you didn’t take it out for living, what was
your opinion at that time?
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