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to make repayment and an intent on the part of the person
advancing the funds to require repayment. See Fisher v.
Commissioner, 54 T.C. 905, 909-910 (1970); Mercil v.
Commissioner, 24 T.C. 1150 (1955). We look to both testimony and
objective facts to ascertain intent. See Busch v. Commissioner,
728 F.2d 945, 948 (7th Cir. 1984), affg. T.C. Memo. 1983-98;
Commissioner v. Makransky, 321 F.2d 598, 600 (3d Cir. 1963),
affg. 36 T.C. 446 (1961). Testimony is not determinative,
particularly where it is contradicted by the objective evidence.
See Busch v. Commissioner, supra; Glimco v. Commissioner, 397
F.2d 537, 540-541 (7th Cir. 1968), affg. T.C. Memo. 1967-119.
In the family context, a transfer of money may be a gift or
a loan. See Hughes v. Commissioner, T.C. Memo. 1992-438.
Furthermore, in the case of a bona fide loan, a gift may
subsequently result should the loan be forgiven. See id.
In the instant case, the $50,000 payment to petitioner came
from the corporation and not directly from the Pattersons.
Generally, a distribution by a corporation to a shareholder out
of accumulated earnings and profits may constitute a dividend
taxable to the shareholder as ordinary income. See secs. 301,
316; Commissioner v. Gordon, 391 U.S. 83, 88-89 (1968); Hardin v.
United States, 461 F.2d 865, 872 (5th Cir. 1972). A formal
dividend declaration is not required for a corporate distribution
to constitute a dividend. See Sachs v. Commissioner, 277 F.2d
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