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reflected on the WAs. The only evidence relating to the
characterization of the amounts reflected on the WAs as either
constructive dividends to petitioner or deductible promotional
expenses consists of the WAs themselves and petitioner’s oral
testimony. As discussed, infra, in section II, our decision that
most of the WAs provided for and generated deductible promotional
expenses is based solely upon those WAs, which are stipulated
joint exhibits. The issue, as framed by the parties, is the
extent to which the stipulated WAs either support or refute
petitioner’s oral testimony that all of the WAs authorized and
resulted in the expenditure of amounts deductible by 2618 as
promotional expenses, and we ultimately find that all but 12 WAs
for 1989 and 7 WAs for 1990 (out of a total of 280 for 1989 and
177 for 1990), are consistent with and, therefore, support
petitioner’s position. On that basis, we sustain respondent’s
proposed adjustment only to the extent of the amounts reflected
in those 12 WAs for 1989 and 7 WAs for 1990. With respect to
those 19 WAs, we find that the notations thereon are more
consistent with the conclusion that such amounts were distributed
to petitioner for his personal use rather than for any
deductible, business-related purpose.
2. Liquidating Dividend Issue
After respondent’s concession as to the amount of any
liquidating dividend, there are two issues for decision: an
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