Bill J. Malone, Jr. and Sarah J. Malone - Page 12

                                       - 12 -                                         
          account.  To the extent that the ownership of assets used in                
          connection with the carrying on of a trade or business is, in               
          general, indicative of ownership, the record in this case, simply           
          put, provides no useful guidance on the point.                              
               Lastly, we consider which individuals provided labor in                
          connection with the business and the extent of that labor.  In              
          this regard we note that Malone Music had no employees during the           
          years in issue.  As we view the matter, although not                        
          determinative in a general sense, in a labor-intensive business             
          with no employees, there is strong suggestion that the                      
          individuals performing the labor own the business.  In this case            
          the record overwhelmingly demonstrates that the business was                
          carried on through the labor of H, R, and other of the Malone               
          children.  This is true not only with respect to the services and           
          programs offered by Malone Music, but with respect to internal              
          activities as well, such as planning and record keeping.                    
          Petitioner describes his labor contribution to the business as              
          “administrative”.  We view it more in the nature of parental.               
          The fact that one or more of the Malone children, rather than               
          petitioner or petitioners, supplied the necessary labor to carry            
          on the business during the years in issue, strongly supports a              
          finding that the business belonged to one or more of the                    
          children, not to petitioner.                                                

Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  15  Next

Last modified: May 25, 2011