Rameau A. and Phyllis A. Johnson v. Commissioner

108 T.C. No. 22

UNITED STATES TAX COURT RAMEAU A. AND PHYLLIS A. JOHNSON, ET AL.,1 Petitioners v. COMMISSIONER OF INTERNAL REVENUE, Respondent Docket Nos. 16038-93, 16039-93, Filed June 16, 1997. 17007-93, 14430-94. Ds sold multiyear vehicle service contracts (VSC's) in connection with the sale of motor vehicles under a common program administered by A, an unrelated party. Under the terms of the program, Ds retained a portion of the contract price as their profit and remitted the remainder to A: (1) For deposit of a specified amount in escrow to fund their obligations under the VSC, and (2)…