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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
corporation.
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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