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Petitioner testified that he would leave a WA, filled out
and signed by him, in the cash register or with the bartender,
and that Helmle could only take from the register the authorized
amount. Petitioner further testified that he never received or
took possession of any of the money shown on the WAs.
Respondent argues that petitioner’s trial testimony was
“self serving, inconsistent, conflicting, and generally not
credible”, and that petitioner failed to produce credible
evidence that the cash and food distributed pursuant to the WAs
were used for any business purpose. He suggests that
petitioner’s failure to call as witnesses any employees of the
club or any dancers suggest that their testimony would have been
negative. He concludes that, because petitioner failed to prove
that the distributions reflected in the WAs were for any business
purpose, they must be considered taxable dividends to petitioner.
The only portion of 2618's alleged expenditures for business
promotion/travel that respondent treats as constructive dividends
to petitioner is that reflected in the WAs. However, the WAs
generally support and corroborate petitioner’s characterization
of the expenditures, not respondent’s. The vast majority of the
WAs simply contain the notation “pro mo” in addition to the date,
the dollar amount, and petitioner’s signature. There is no
indication that the specified dollar amounts were to be paid to
petitioner rather than to a third party pursuant to petitioner’s
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