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presumption. They show that those who worked at Lykins Financial
continued to receive paychecks drawn on Lykins Inc., continued to
receive benefits provided by Lykins Inc., and continued to have
their Social Security tax paid for by Lykins Inc. They had
worked at Lykins Inc. at the start of 2000, and those working on
financial services during the year were told to do so by Lykins
Inc. Lykins Financial even reimbursed Lykins Inc. for their
wages, taking a deduction; Lykins Inc. reported those
reimbursements as income.
Simply allocating the costs of Lykins Inc. employees to
Lykins Financial does not make them Lykins Financial employees.
And, while the line between Lykins Inc. and Lykins Financial was
clear only in its blurriness, we conclude on the peculiar facts
of this case--especially the fact that before Lykins Financial
was formed, all these employees were Lykins Inc. employees, and
continued to have their wages, benefits, and taxes paid by Lykins
Inc.--that they continued to be Lykins Inc. employees throughout
the year.
This makes deciding the case easy. Lykins Inc. and the
Commissioner stipulated to a breakdown of Lykins Inc.’s
employees’ hours into two categories: hours spent on accounting
and consulting services, and hours spent on investment services.
The exhibit shows that 80.53 percent of employee hours in 2000
were spent on accounting services, while 19.47 percent of
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