Carl E. Jones and Elaine Y. Jones - Page 22

                  Petitioner alleged that he assumed much of the debt that                            
            Development owed to petitioner's other wholly owned corporations.                         
            These "assumptions" without actual payments are merely                                    
            bookkeeping entries designed to give the illusion of repayments.                          
            Moreover, with regard to the loan amounts that were reclassified                          
            as salary, we are mindful that petitioner had the authority to                            
            determine the size of his salary.  Petitioner's use of his salary                         
            to credit his loan account was simply a bookkeeping entry                                 
            designed to give his withdrawals the color of loans.  Id.                                 
                  On the basis of our examination of the entire record, we                            
            find that petitioner has not established that he entered into a                           
            bona fide creditor-debtor relationship with Development at the                            
            times of the withdrawals at issue.  Petitioner simply used the                            
            corporation as his own personal pocketbook, depositing and                                
            withdrawing funds at will.                                                                
                  Petitioner argues on brief that, if this Court should find                          
            that the withdrawals are not bona fide loans, then the amount of                          
            the distributions subject to tax is the net amount by which the                           
            distributions over the 3 years at issue exceed the total amount                           
            of the repayments made over the same time period.  Petitioners                            
            cite Epps v. Commissioner, T.C. Memo. 1995-297, and Stovall v.                            
            Commissioner, T.C. Memo. 1983-450, affd. 762 F.2d 891 (11th Cir.                          
            1985), as authority for combining the years at issue and taxing                           
            the net amount.                                                                           

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