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now contends with respect to that loan that he is entitled to a
business bad debt deduction under section 166(a) of $112,123.
Respondent counters that petitioner is not entitled to a business
bad debt deduction, or to any other deduction, for 1993 with
respect to the Miller loan.
In support of his position that he is entitled to a business
bad debt deduction under section 166(a), petitioner contends that
the Miller loan constituted a business debt for purposes of
section 166, that $2,6418 of that loan became worthless during
1993 within the meaning of that section, and that the amount of
the deduction under section 166(a) for 1993 attributable to that
worthless debt is $112,123, consisting of $2,641 of unrecovered
principal of the Miller loan and $109,482 of attorney’s fees
which he claims he incurred as of the end of 1993 in recovering
that loan.9 Respondent disputes petitioner’s contentions.
Section 166 allows a taxpayer to deduct any business debt
which becomes wholly or partially worthless during the taxable
year.10 See sec. 166(a), (d)(1)(A). The basis for determining
8For convenience, we have rounded to the nearest dollar the
amount of the unrecovered portion of the Miller loan as of the
end of 1993.
9We have considered all of the contentions and arguments of
petitioner that are not discussed herein, and we find them to be
without merit and/or irrelevant.
10In the case of a taxpayer other than a corporation, where
a nonbusiness debt becomes worthless during the taxable year, the
(continued...)
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