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trusts' assets. It is asserted that petitioner has failed to
comply with the safe harbor provisions of section 675(3). To the
contrary, petitioner contends that the provisions of section
675(3) are met and that he is entitled to the claimed interest
deductions. We agree with petitioner.
Section 675(3) provides that the grantor shall be treated as
the owner of any portion of a trust in respect of which the
grantor has directly or indirectly borrowed the corpus or income
and has not completely repaid the loan, including the interest,
before the beginning of the taxable year. However, the section
also provides that this requirement does not apply to a loan
which provides for adequate interest and security and if the loan
is made by a trustee other than the grantor and other than a
related or subordinate trustee subservient to the grantor. Here
these three conditions are met: (1) The loans bore adequate
interest; (2) the loans were adequately secured; and (3) the
majority of the trustees (the two attorneys) were not related,
subordinate, or subservient to the grantor. Lawyers are not
proscribed by section 672(c) and thus may qualify as independent.
See Bittker & Lokken, Federal Taxation of Income, Estates and
Gifts, par. 80.1.4, at 18-19 (2d ed. 1991); 452-2nd T.M. Grantor
Trusts: Sections 671-679, A-14. See also Estate of Goodwyn v.
Commissioner, T.C. Memo. 1976-238. Moreover, even if section
675(3) did apply, its effect by its terms is to tax all or a
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