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Petitioners rely on a Memorandum Opinion of this Court, Hunt
v. Commissioner, T.C. Memo. 1989-335, contending that the facts
in the Hunt case are very similar to the facts in the instant
case. We disagree. The taxpayers in Hunt lent their children
substantial funds to enable them to make margin calls in the
silver and gold commodities markets. The Hunt case can be
distinguished in several respects from this case. In Hunt we
found that a bona fide debtor-creditor relationship existed.
First, in Hunt, a demand for repayment was made although the
taxpayers knew that the amounts could not be repaid. Second, the
notes in Hunt bore interest at the prime rate. Third, some of
the notes in Hunt had fixed maturity dates. Fourth, repayments
were made by two of the taxpayers' children and one child repaid
in full the sums she borrowed. Fifth, in Hunt, there was a bona
fide business purpose for the transactions and no spendthrift
behavior. Finally, in Hunt, we found that there was a gift at
the point when the parents continued to lend, knowing that
repayment was impossible. Thus, petitioners' reliance on Hunt is
misplaced.
In consideration of all the facts and circumstances, we find
that petitioners have failed to meet their burden of proving that
any of the Price Co. shares transferred in October and December
1987 created bona fide debts which arose from a debtor-creditor
relationship, and not gifts.
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