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existence of notes in this case is not strong evidence of the
character of the transactions because the notes were not signed
on or around the time of the distributions. Petitioners argue
that the presence of the notes is strong evidence of debt.
Brian testified that the notes were not prepared or signed
contemporaneously with the receipt of funds. He was unsure of
when he had signed the notes but believed it to be in either 1992
or 1993. Brian further stated that he signed the notes "at least
a year" after the receipt of the funds. Wayne did not know
exactly when he had signed the notes. Given this testimony and
other evidence in the record, the mere presence of notes is
assigned little weight unless supported by some other objective
evidence showing the distributions to be loans, especially
considering petitioners' relationship to Erie Industries and
Wayne's position as Plan trustee. Additionally, Brian's failure
to sign three of his notes and Wayne's failure to sign one of his
notes weakens petitioners' position that the notes are strong
evidence of debt. Under these circumstances, "form does not
necessarily correspond to the intrinsic economic nature of the
transaction". Fin Hay Realty Co. v. United States, 398 F.2d 694,
697 (3d Cir. 1968). This indicium offers no more than marginal
support for the existence of debt.
b. Provisions for Security, Interest Payments, and a Fixed
Repayment Date
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