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Investments certificates of deposit, a BayBank money market
account, a BayBrokerage account (for 1996 only), and a BayBank
escrow account. Moneys received pursuant to preneed contracts
were placed by petitioner in one of the investment vehicles.
Upon petitioner’s provision of goods and services at the death of
a preneed contract beneficiary, an amount equal to the purchase
price of the contract was transferred from the investment
accounts to petitioner’s checking account.
The BayBank escrow account is a compilation of accounts,
opened before 1996, each in the name of an individual contract
beneficiary. Petitioner’s accountant advised establishment of
the escrow account in the early 1990s. This account was used for
the deposit of preneed receipts for a period prior to the years
in issue, until the resultant administrative burden caused
petitioner to discontinue the practice. The balance of the
BayBank escrow account as of January 1, 1996, was $106,579.16,
and those funds are not at issue in this proceeding. The
investments other than the Baybank escrow account are held solely
in petitioner’s name and list petitioner’s tax identification
number.
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Last modified: May 25, 2011