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"reaffirmation", and that both loans were obtained from the same
lender. However, the material terms of the two loans, such as
the interest rates, prepayment premiums, and repayment periods
are significantly different. The requirement of an additional
commitment fee further convinces us that the permanent loan
constituted a separate obligation on behalf of ME. Moreover, the
fact that SouthTrust Bank was the lender of each loan is not
determinative of our decision. See Buddy Schoellkopf Prods.,
Inc. v. Commissioner, 65 T.C. 640, 648-650 (1975).
After examining the material terms contained in the loan
documents, in lieu of relying merely on their labels, we find
that the construction loan and the permanent loan are separate
loans. We therefore hold that ME properly amortized its loan
commitment fee and attorney's fees over the 1-year period of its
construction loan.
Taxes
The fourth issue for decision is whether REE and ME are
entitled to deductions pursuant to section 164(a) for certain
taxes incurred in connection with recording mortgages in the
State of Florida.
REE and ME incurred the following amounts of intangible
personal property taxes and documentary stamp taxes during 1992:
Intangible Personal Documentary
S Corporation Property Tax Stamp Tax
REE $ 900 $1,440
ME 3,000 4,800
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