V.R. DeAngelis M.D.P.C. & R.T. Domingo M.D.P.C., V. R. DeAngelis M.D.P.C., Tax Matters Partner, et al. - Page 60




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          regard, we note our finding on the basis of the credible evidence           
          in the record that Drs. DeAngelis and Domingo, when dealing with            
          Mr. Rapp, MetLife, and the insurance policies in general, were              
          not acting as agents of VRD/RTD but were acting in their                    
          individual capacities.  We also note our finding that Dr. Durante           
          was not acting as an agent of VRD/RTD with respect to his policy.           
               The use of whole life insurance policies and the direct                
          interactions between the participating doctors and the STEP plan            
          representatives support our finding that the participating                  
          doctors in their individual capacities fully expected to get                
          their promised benefits and that any receipt of those benefits              
          was not considered by anyone connected with the life insurance              
          transaction to rest on any unexpected or contingent event.  Each            
          whole life insurance policy upon its issuance was in and of                 
          itself a separate account of the insured doctor, and the insured            
          (rather than the STEP plan) dictated and directed the funding and           
          management of the account and bore most risks incidental to the             
          account’s performance.  The STEP plan in essence and in operation           
          was simply an aggregation of separate plans for the participating           
          doctors and not, as petitioners claim, one single plan in which             
          various employers participated.  The cash value in a                        
          participating doctor’s policy was both intended to be and                   
          actually returned to the insured doctor, net of reductions for              
          the cost of current insurance coverage and other de minimis                 







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