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basis" to support the deduction with respect to three
partnerships, Speed Line Investment, Dondi Presidents'
Partnership II, and 1626 New York Associates, Ltd.
Partnership. We review the record with respect to each
of these partnerships.
Petitioner was a general partner in Speed Line
Investment, a partnership formed to engage in the breeding
and sale of thoroughbreds and quarter horses. He held a
25-percent interest in the partnership during 1987 and
1988. He claims that in 1985 the partnership borrowed
$620,000 from the First City Savings Bank in Los Colinas
and that he and Mr. Dixon personally guaranteed the loan
and pledged a certificate of deposit in the amount of
$120,000 and the assets of the partnership as collateral.
He also claims that approximately $170,000 of the loan was
outstanding at the end of 1987. In effect, petitioner
claims that his share of the liability for 1987 would have
been $42,500 (i.e., $170,000 x 25 percent). Petitioner
testified that there was no change in 1988 for this
liability and for the amount of the partnership's debt.
Contrary to petitioner's testimony, the Schedules K-1,
Partner's Share of Income, Credits, Deductions, etc.,
issued to petitioner by Speed Line Investment, show that
petitioner had a negative capital account as of the end of
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