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2. Incorporation of King’s Appliances
King’s Appliances was a sole proprietorship in 1995.
Petitioners transferred their assets to King’s Appliances, Inc.,
around January 1, 1996. On November 16, 1998, King’s Appliances,
Inc., elected to be an S corporation effective January 1, 1996.
The stock of King’s Appliances, Inc., was held as follows: Mr.
King, 51 percent; Mrs. King, 30 percent; and petitioners’ son,
Howard G. King, 19 percent.
3. Petitioners’ Purchase of the South Oates Street
Building
In 1977, petitioners bought a building on South Oates Street
(the South Oates building) in Dothan, Alabama, for $75,000. Mr.
King served as the general contractor when they added a second
floor to the building in 1978. Petitioners paid a subcontractor
$67,000 to build the shell of the addition and paid additional
amounts to finish the interior of the addition. King’s
Appliances occupied the South Oates building until 1990.
Petitioners used it for storage from 1990 to 1996. Petitioners
sold the South Oates building in 1996 for $100,000.
4. Petitioners’ Purchase of Land for the Ross Clark Circle
Building
Petitioners bought land in Dothan, Alabama, and built the
Ross Clark building in 1988. Petitioners hired a contractor to
build the shell of the building for which they paid about
$500,000. After a windstorm destroyed part of the building
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Last modified: May 25, 2011