- 14 -
Offshore, Inc. v. Commissioner, 97 T.C. 579, 602 (1991). Whether
a transfer creates a debt is a question of fact, for which the
taxpayer bears the burden of proof. Rule 142(a); Welch v.
Helvering, 290 U.S. 111, 115 (1933); Bauer v. Commissioner,
748 F.2d 1365, 1368 (9th Cir. 1984), revg. T.C. Memo. 1983-120;
A. R. Lantz Co. v. United States, 424 F.2d 1330, 1334 (9th Cir.
1970); Crown v. Commissioner, 77 T.C. 582, 598 (1981); Gilbert v.
Commissioner, 74 T.C. 60, 64 (1980). The key to this factual
determination turns primarily on the taxpayer's actual intent, as
shown by the circumstances and condition of the transfer.
Bauer v. Commissioner, supra at 1367-1368; A. R. Lantz Co. v.
Commissioner, supra at 1333. In passing on this intent, the
Court of Appeals for the Ninth Circuit, to which appeal in this
case lies, has considered 11 factors. These factors, which are
not equally significant and none of which is controlling by
itself, are: (1) The names given to the certificates evidencing
the indebtedness, (2) the presence or absence of a fixed maturity
date, (3) the source of payments, (4) the right to enforce the
payment of principal and interest, (5) participation in
management as a result of the advances, (6) a status of the
advances equal to or inferior to that of regular corporate
creditors, (7) the intent of the parties, (8) the identity of
interest between creditor and stockholder, (9) a thin or adequate
capitalization, (10) the ability of the corporation to obtain
loans from outside sources, and (11) the payment of interest only
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