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dealings.5 Mr. Tripp testified that the cosmetologist collaborated
with the Tripp partnership as an independent contractor and that
during a period in which Mr. Tripp was hospitalized, the
cosmetologist helped ensure the continued operation of the Tripp
partnership beauty salon. Mr. Tripp stated that the Tripp
partnership, as opposed to Mr. Tripp personally, transferred cash
and used equipment to her. Nothing in the record indicates that
the transfer was other than by the Tripp partnership and was other
than at arm’s length.
While it is true, as respondent points out, that the record
does not contain any documentary substantiation as to the amount
of cash or the precise value of the transferred equipment, we are
satisfied from Mr. Tripp’s testimony that the value of the items
transferred was $24,052 as claimed by the Tripp partnership. We
found Mr. Tripp’s testimony credible, and his testimony was
uncontroverted by any evidence submitted by respondent.6
Because we hold that petitioner was entitled to the claimed
deductions for losses from her interest in the Tripp partnership
and that the Tripp partnership was entitled to a $24,052 salary
5Mr. Tripp had contemplated the sale of a beauty salon
(other than the one operated by the Tripp partnership) to the
same cosmetologist in 1999 in an arm’s-length transaction. That
sale was not consummated.
6Moreover, we are mindful that respondent raised the same
issue in Mr. Tripp’s case and subsequently conceded it. See
supra note 2.
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Last modified: November 10, 2007