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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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