- 28 -
U.S. 726, 738 (1989)); Gordon v. Commissioner, supra at 324
(citing Commissioner v. Court Holding Co., 324 U.S. 331, 334
(1945); Helvering v. Clifford, 309 U.S. 331, 334 (1940); Grif-
fiths v. Helvering, 308 U.S. 355, 357-358 (1939); Professional
Servs. v. Commissioner, 79 T.C. 888, 913 (1982)).
While we are not required to sustain respondent's determina-
tions solely because tax reasons affected the way in which
petitioners structured the transaction, see Kornfeld v. Commis-
sioner, T.C. Memo. 1996-472, petitioners have the burden of
proving that respondent's determinations are erroneous, Rule
142(a); Welch v. Helvering, 290 U.S. 111, 115 (1933). Where, as
here, the parties to the transactions are related, the level of
skepticism as to the form of the transaction is heightened,
"because of the greater potential for complicity between related
parties in arranging their affairs in a manner devoid of legiti-
mate motivations." Vaughn v. Commissioner, 81 T.C. 893, 908
(1983) (citing Bowen v. Commissioner, 78 T.C. 55, 78 (1982),
affd. 706 F.2d 1087 (11th Cir. 1983)).
We have confronted this same issue several times before in a
variety of contexts. In deciding these cases, we have undertaken
an intensely factual analysis of the substance of each
transaction. See, e.g., Kornfeld v. Commissioner, T.C. Memo.
1996-472; Gordon v. Commissioner, supra at 326-327; Lomas Santa
Fe, Inc. v. Commissioner, 74 T.C. at 681. Therefore, we believe
a brief review of the cases previously decided will paint a more
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