J. Ramsay Farah and Elizabeth Farah - Page 5




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          with his children would make it difficult to attach.  Upon                  
          formation of the Family Partnership, Dr. and Ms. Farah each held            
          a 35-percent interest.  Two of their four children, Frederick               
          Farah (then age 17) and Veronica Farah (then age 11), each owned            
          15-percent interests.4  The partnership agreement was signed by             
          Dr. and Ms. Farah.  It was not signed by either of their                    
          children, nor did either child make a capital contribution to the           
          Family Partnership.  The Family Partnership did not register as a           
          business entity in the State of Maryland or obtain an employee              
          identification number.                                                      
               On the day of its formation, the Family Partnership                    
          completed the purchase of the South Point Road lot.  At the time            
          of purchase, the only structure on the lot was a tool shed.                 
          There was no separate electricity line, well, sewer line, or                
          septic system.  At the closing, petitioners paid $51,880 in cash.           
          The balance of the purchase price was financed through a                    
          promissory note and a purchase money mortgage to the seller made            
          by the Family Partnership.                                                  
               Petitioners made improvements to the South Point Road lot.             
          They constructed a bulkhead and concrete path that extended along           
          the shoreline from the Berlin Residence property into the South             
          Point Road lot to protect the property from the water.  They also           
          constructed a fence that went around both properties.  The lots             

               4Petitioners also had two older children, Patrick Farah and            
          another whose name was not disclosed in the record.                         





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