-20-
Petitioner made more than 40 withdrawals in 1989, more than
70 withdrawals in 1990, and 9 in the first month of 1991.13 The
amounts withdrawn ranged from $350 to $98,753 in 1989,14 $10 to
$166,904 in 1990,15 and $62 to $12,704 in the first month of
1991. It is clear from the number of withdrawals, the wide range
of the amounts withdrawn, and the uses of the withdrawn amounts
that petitioner used the corporation as his personal pocketbook
from which he could extract funds at will and to which he could
deposit funds at his convenience. Moreover, if there was a
ceiling on the amounts that petitioner could withdraw, he did not
reach it before Development ceased doing business in 1991.
Development recorded the withdrawals on its books and
records as loans to petitioner. While this factor does weigh in
favor of finding the amounts withdrawn were loans, this factor is
not determinative without further evidence substantiating the
existence of bona fide loans. Baird v. Commissioner, 25 T.C.
387, 394-395 (1955).
13
The evidence submitted of petitioner's withdrawals from
Development is limited to the first month in 1991.
14
The explanation on Development's books for the $98,753
increase is "Corporation's assumption of stockholder's liability
to Winterchase Townhomes, Inc."
15
The explanation for the $166,904 withdrawal recorded on
Development's records is "Transfer of Winterchase lots to Elaine
Jones (net of liabilities assumed)." Although the transfer of
property was to Mrs. Jones, the amount of the transfer was
recorded as an increase (debit) to the loan account.
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