- 36 -
F.2d 945 (7th Cir. 1984), affg. T.C. Memo. 1983-98; Thielking v.
Commissioner, supra.
Shareholder repayments are evidence that a withdrawal from a
corporation constituted a loan. The repayment, however, must be
bona fide. Crowley v. Commissioner, T.C. Memo. 1990-636, affd.
962 F.2d 1077 (1st Cir. 1992). Little weight need be given to
repayments that appear to be motivated by a tax audit. Crowley
v. Commissioner, 962 F.2d at 1084. Additionally, the fact that a
taxpayer made some repayments may be overshadowed where total
withdrawals each year, after repayments, steadily increase from
year to year. See Regensburg v. Commissioner, 144 F.2d 41, 44
(2d Cir. 1944), affg. a Memorandum Opinion of this Court dated
Apr. 20, 1943; Electric & Neon, Inc. v. Commissioner, 56 T.C.
1324, 1339 (1971), affd. without published opinion 496 F.2d 876
(5th Cir. 1974); Koufman v. Commissioner, T.C. Memo. 1976-330.
Further, repayments that occur through bookkeeping entries
such as salary credits and credits for bonuses are given less
weight because such repayments are funded by the corporation.
Busch v. Commissioner, 728 F.2d 945 (7th Cir. 1984), affg. T.C.
Memo. 1983-98; Estate of Taschler v. United States, 440 F.2d 72,
76 (3d Cir. 1971). In Estate of Taschler, the Court of Appeals
for the Third Circuit noted the following with regard to
repayments in the form of salary credits:
Within limits, taxpayer had complete control over the
amount of his salary payments. He could have increased
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