Reza and Connie M. Rezazadeh - Page 14

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          in order to deduct the loans to the corporation as a business bad           
          debt, petitioner had to show that the dominant motive in making             
          the loans was to protect his employment, as opposed to an                   
          investment in the corporation.                                              
               Petitioner made a significant contribution to the                      
          corporation.  As a result of his efforts, it appears the                    
          corporation was on its way to becoming a successful venture.  The           
          total commissions and fees earned by the corporation from 1977 to           
          1979 were $8,865, $32,340, and $79,712, respectively.  While                
          petitioner received, in 1977 and 1978, approximately 50 percent             
          of these net proceeds, in lieu of a stated salary, in 1979,                 
          petitioner received only $20,000 as "salary" because petitioner             
          and Mr. Takos decided to limit the amount they received from the            
          corporation to $20,000 each until the corporation was                       
          successfully established.  The Court does not believe that                  
          petitioner would have been able to survive financially on this              
          limited "salary" if petitioner had not maintained his full-time             
          job at the University during the years 1977 to 1979.  Considering           
          the limited "salary" petitioner received from the corporation,              
          the fact that petitioner received a full-time salary from the               
          University while the corporation was in business, and the fact              
          that petitioner made a significant initial capital contribution             
          of $20,000 to the corporation, the Court concludes that, at the             
          time petitioner made the loans to the corporation, the dominant             





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