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Conf. Rept. 98-861, at 1015 (1984), 1984-3 C.B. (Vol. 2) 1, 269;
Staff of Joint Comm. on Taxation, General Explanation of the
Revenue Provisions of the Deficit Reduction Act of 1984, at 528-
529 (J. Comm. Print 1984).
Section 7872 applies to a transaction that is: (1) A loan;
(2) subject to a "below-market" interest rate; and (3) described
in one of several enumerated categories. Sec. 7872(c)(1),
(e)(1), (f)(8). Petitioners do not contest that the advances
from RSI constitute loans, or that the loans were from a
corporation to its shareholders (one of the enumerated categories
under section 7872(c)(1)). Rather, petitioners maintain that the
advances were not made at a below-market rate, and therefore
section 7872 does not apply to impute dividend income to them.
In order to determine whether the below-market loan
requirement is satisfied for purposes of applying section 7872,
we must ascertain whether the loan is (1) A demand or term loan
and (2) subject to a below-market interest rate. See sec.
7872(e)(1).
Below-market loans fit into one of two categories: Demand
loans and term loans. Sec. 7872(e)(1); see H. Conf. Rept. 98-
861, at 1018, 1984-3 C.B. (Vol. 2) at 272. A demand loan
includes "any loan which is payable in full at any time on the
demand of the lender." Sec. 7872(f)(5). A term loan is "any
loan which is not a demand loan." Sec. 7872(f)(6). The
determination of whether a loan is payable in full at any time on
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