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11. Petitioners paid most of Diane Racing’s expenses from
their personal, and not Diane Racing’s, bank account.
12. Although the Diane required a 14-person crew, usually
all of the crew were unpaid.7
13. Petitioners did not possess a list of crew members.
14. Petitioners did not keep payroll records for the crew
members who were paid.
15. Petitioners never filed any Forms W-2 or Forms 1099 for
the crew members who were paid.
16. Petitioners did not keep records of the entry fees for
any of the races the Diane participated in during the years in
issue.
17. Petitioners “hoped” that they might get sponsors for
the yacht racing activity, but they “had no idea whether that
would or would not work.”
18. Mrs. Schwartz, who holds a doctorate in education and
is director of a special education master’s degree program, was
in charge of many financial aspects of Diane Racing.
19. Although petitioners spent, on average, a total of 15
to 20 hours per week working on Diane Racing, there were
significant periods when petitioners devoted no time to, or were
not involved with, Diane Racing.
7 Diane Racing paid a captain if a captain was needed, and
a mate if there was a mate.
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Last modified: May 25, 2011