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879, 882 (8th Cir. 1960), affg. 32 T.C. 815 (1959); Paramount-
Richards Theatres, Inc. v. Commissioner, 153 F.2d 602, 604 (5th
Cir. 1946), affg. a Memorandum Opinion of this Court; Yelencsics
v. Commissioner, 74 T.C. 1513, 1529 (1980). All of the facts
surrounding a transaction must be considered to determine whether
a payment by a corporation to a taxpayer constitutes a dividend
or something else; e.g., a loan, a gift, or compensation for
services. See John Kelley Co. v. Commissioner, 326 U.S. 521, 526
(1946); Hardin v. United States, supra; see also Milenbach v.
Commissioner, 106 T.C. at 195. A corporation’s cancellation of a
shareholder’s indebtedness may constitute a constructive dividend
or compensation for services. See Shephard v. Commissioner, 340
F.2d 27, 29-30 (6th Cir. 1965), affg. per curiam T.C. Memo. 1963-
294; see also Estate of Shapiro v. Commissioner, T.C. Memo. 1987-
126.
Petitioner introduced no evidence directed toward
establishing the corporation’s intent in paying her $50,000
during 1989.7 The Pattersons controlled the corporation, and
they played an integral part in the decision for the corporation
7This Court does not consider statements in a brief as
proof. See Rule 143(b); Niedringhaus v. Commissioner, 99 T.C.
202, 214 n.7 (1992); Viehweg v. Commissioner, 90 T.C. 1248, 1255
(1988). Although petitioner indicated that she wished to testify
at trial, she declined to swear under oath or affirm or otherwise
verify that her testimony would be true and made under penalty of
perjury. Accordingly, we could not permit her to testify. See
Fed. R. Evid. 603; DiCarlo v. Commissioner, T.C. Memo. 1992-280;
cf. United States v. Ward, 989 F.2d 1015 (9th Cir. 1992).
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