Madeline Cook - Page 7

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          agent business.  The fact that she reported her travel agent                
          business activities on a Schedule C does not preclude petitioner            
          from being involved in another trade or business.  On the other             
          hand, being a shareholder of a corporation in which she                     
          admittedly has little involvement, see supra note 2, does not               
          mean that petitioner is in the trade or business of that                    
               On the basis of the entire record in the instant case, we              
          conclude that petitioner was merely a 51-percent shareholder of a           
          company that, after the sale of its assets to Puro, served as               
          nothing more than a conduit for payments from Puro that were                
          applied for the benefit of petitioner and her son.  Cold Springs            
          was not in a trade or business after the sale of its assets to              
          Puro.  Moreover, even if Cold Springs were in a trade or                    
          business, petitioner's limited involvement with Cold Springs does           
          not provide sufficient nexus between the loans to Hamilton and              
          any business of petitioner's own to qualify the debts as bad                
          business debts.  See Whipple v. Commissioner, supra at 202.                 
          Because petitioner's loans to Hamilton were not proximately                 
          related to a trade or business carried on by petitioner, they are           
          not business bad debts.  Accordingly, petitioner is not entitled            
          to a business bad debt deduction for the loans made to Hamilton.            

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