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the crop hail insurance business for $25,000. Respondent argues
that the $25,000 is income to petitioner in 1990. Petitioner has
the burden of proving that the sale proceeds were not income to
him. Petitioner maintains that WFIC owned the crop hail
insurance business when it was sold.
Petitioner did not present any documentation of the
purported transfers of the business to Taxman and to WFIC. In
the 1987 deposition, petitioner admitted that the transfer to
Taxman was not documented. The 1990 purchase agreement was
between Mr. Ihry and Jondahl Insurance, not WFIC. Likewise, the
checks paid for the purchase of the business by Mr. Ihry were
made out to Jondahl Insurance, although petitioner deposited the
checks into WFIC’s bank account. Jondahl Insurance was a party
to agency agreements with Farmer’s Mutual and Old Republic
Insurance Co. in 1986 and 1989, after its alleged transfer.
Neither Taxman nor WFIC is mentioned on either contract.
Farmer’s Mutual listed “Jondahl Insurance Agency” on its policy
registers for 1990 and 1991. Petitioner has not shown any
evidence to support his claim that his insurance customers
received bills from Taxman or that any customers were confused as
to the ownership of the business. In addition, petitioner did
not report capital gain from the sale of the insurance business
on WFIC’s 1990 or 1991 corporate return.
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