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trusts therefor) purportedly contributed oral accounts receivable
in exchange for their partnership interests. The accounts
receivable, however, were never reduced to writing, had no terms
for repayment, and had not been paid as of the time of trial.
By fax dated December 28, 1998, petitioners informed their
accountant that they had transferred stock to SFLP I and sought
advice as to what percentage of partnership interests they should
transfer to the children. On that same day, petitioner gave to
each child (or trust therefor) a 29.94657-percent limited
partnership interest in SFLP I. Michele Senda (Senda) gave to
each child (or trust therefor) a 0.0434-percent limited
partnership interest in SFLP I. The certificates of ownership
reflecting these transfers were not prepared and signed until
several years thereafter.
The SFLP I Agreement provides that the general partner shall
prepare or have prepared annual financial statements. It further
provides that, not less than annually, all partners shall meet to
discuss the financial condition of the partnership. SFLP I has
never had annual financial statements prepared or held
partnership meetings. The only books and records maintained by
petitioner, as general partner, were brokerage account statements
and partnership tax returns. The 1998 Form 1065, U.S.
Partnership Return of Income, for SFLP I was signed by the tax
return preparer on October 8, 1999.
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