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corporation to obtain loans from outside sources; (12) the use to
which the advances were put; and (13) the failure of the debtor
to repay on the due date. See also Dixie Dairies Corp. v.
Commissioner, 74 T.C. 476, 493 (1980).
The identified factors are not equally significant, nor is
any one factor determinative. See Estate of Mixon v. United
States, supra; Dixie Dairies Corp. v. Commissioner, supra. The
factors must be evaluated in light of all the facts and
circumstances. See Dixie Dairies Corp. v. Commissioner, supra.
1. Names Given to the Certificates
The issuance of a note may be indicative of bona fide debt.
See Estate of Mixon v. United States, supra. The existence of a
note, however, is not in and of itself conclusive. An unsecured
note, with payments thereon made long after the due date or else
not at all, weighs toward equity. See Stinnett’s Pontiac Serv.,
Inc. v. Commissioner, supra; Estate of Van Anda v. Commissioner,
12 T.C. 1158, 1162 (1949), affd. per curiam 192 F.2d 391 (2d Cir.
1951).
Two of petitioner’s 1993 advances, of $25,000 each, were not
evidenced by any kind of debt instrument. As applied to these
two advances, this factor weighs toward equity.
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