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extensive, does not constitute a trade or business. Higgins v.
Commissioner, 312 U.S. 212, 218 (1941).
In the instant case, it is unclear whether petitioner was
engaged in any trade or business in 1989 and 1990. He was
involved in the activities of Time To Share, but the extent of
those activities is uncertain. He received no remuneration
whatsoever for his efforts, and we cannot even classify him as an
employee. Petitioner does not contend, nor does the record
support a finding, that petitioner was in the business of making
loans. Accordingly, to the extent that the advances are proven
worthless in 1990, we hold that the debts were nonbusiness bad
debts, deductible as short-term capital losses.5
A bad debt is deductible only in the year it becomes
worthless. Denver & R. G. W. R. Co. v. Commissioner, 32 T.C. 43,
56 (1959), affd. 279 F.2d 368 (10th Cir. 1960); Feinstein v.
Commissioner, 24 T.C. 656, 658 (1955). Petitioner has the burden
of proving that the debt became worthless during the year in
question. Rule 142(a); Estate of Mann v. United States, 731 F.2d
267, 275 (5th Cir. 1984); James A. Messer Co. v. Commissioner, 57
5 The $2,900 check of Jan. 30, 1990, is not a true loan
or advance. It was payment for the sale of a car. The record is
insufficient to allow any deduction on that account. Moreover,
the amount of loss with regard to the Oct. 9, 1990, promissory
note for $2,869 given for transfer of water filters, etc.,
depends upon petitioner's basis in the transferred assets, which
has not been established herein. Consequently, no part of the
$2,869 is deductible herein.
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