Stephen F. Scofield and Nancy E. Scofield - Page 18

          Petitioners' argument misses the mark.  We consider whether a               
          taxpayer's dominant motive in becoming a guarantor is proximately           
          related to his or her trade or business at the time of the                  
          guaranty rather than when a payment in discharge is made.  United           
          States v. Generes, supra at 104; Harsha v. United States, supra.            
          Thus, we do not consider petitioner's motive when he made the               
          settlement payment.                                                         
               Petitioners cite Syracuse v. Commissioner, T.C. Memo. 1981-            
          340.  In Syracuse, we held that a debt is a business debt if the            
          dominant motive for creating or acquiring it is to benefit the              
          lender's trade or business.  Petitioners' reliance on Syracuse is           
          misplaced.  The taxpayer in Syracuse lent money to another                  
          business to benefit his own business.  We found that the taxpayer           
          in Syracuse was in the landfill business and not merely                     
          investigating and preparing to enter the business when he lent              
          the money.  Unlike the taxpayer in Syracuse who lent money to               
          benefit his trade or business, petitioner did not guarantee                 
          Northeast's line of credit to enhance his trade or business.                
                    c.   Conclusion                                                   
               Petitioner's dominant motive for guaranteeing the bank line            
          of credit to Northeast was to enhance his investment in                     
          Northeast, not his trade or business.  Thus, petitioners may not            

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