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With respect to respondent's contention that the 1991
interest payment is not investment interest because the 1985
stock and real property transfer constituted repayment of the
1982 plan loan, the parties to the 1991 settlement (viz., respon-
dent, the Hickman corporation profit-sharing plan, and petition-
ers) agreed in that settlement that the 1982 plan loan had an
"outstanding loan balance" and that that loan, which the IRS
determined was a prohibited transaction, was to be corrected
"through repayment of the outstanding loan balance, principal
plus interest". On the record before us, we shall not allow
respondent to abandon the agreement reflected in the 1991 settle-
ment that there was an outstanding loan balance during 1991 with
respect to the 1982 plan loan and that the principal of that
loan, plus interest, was paid by petitioner on October 4, 1991.
Consequently, we reject respondent's argument that the 1985 stock
and real property transfer constituted repayment of the 1982 plan
loan.
We now address respondent's contention that, assuming
arguendo that the Court were to determine that the 1982 plan loan
was not repaid during 1985 by the 1985 stock and real property
transfer, the 1991 interest payment is not investment interest
because petitioners have failed to show that the $130,000 of
proceeds from that loan are traceable to an investment expendi-
ture from June 4, 1982, when the 1982 plan loan was made, through
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