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Petitioner does not dispute that he received payments in the
amounts determined by respondent for the years in issue. In any
event, respondent presented substantial evidence that petitioner
received such payments (with slight modifications as found by the
Court). Petitioner contends that such payments were not
partnership fee income but were either: (1) Repayments of loans
from the partnerships to petitioner; (2) nontaxable partnership
withdrawals by petitioner chargeable to the capital accounts; or
(3) loans to petitioner from the partnerships. We will now
consider these arguments.
Section 707(a) provides that, if a partner engages in a
transaction with a partnership other than as a partner, the
transaction shall, except as otherwise provided, be treated as
occurring between the partnership and one who is not a partner.
Section 707(c) provides that payments to a partner for services
or the use of capital, if fixed without regard to the income of a
partnership, are to be considered as made to one who is not a
member of the partnership, but only for the purposes of including
such amounts in the recipient's gross income and allowing a
business expense deduction to the partnership. Specifically,
section 707(c) provides:
(c) Guaranteed Payments.--To the extent determined
without regard to the income of the partnership,
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