Ruidoso Racing Asso. v. Commissioner

During the taxable years 1959 through 1961, inclusive, petitioner-corporation owned and operated a racetrack at Ruidoso Downs, New Mexico. Its majority stockholder and secretary-treasurer, Eugene V. Hensley, during this period formulated policy, maintained supervision of its records, and had virtually unlimited control of petitioner's business affairs. In 1967, Hensley was convicted for evasion of his own income tax and for making and subscribing false returns with respect to petitioner for the years 1959 and 1960. The criminal income tax case against Hensley involved his use of corporate…