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While Estate of Mixon provides a framework for analysis,
great flexibility in its application is permitted. The factors
are not of equal importance, and no single factor is controlling.
See Dillin v. United States, 433 F.2d 1097, 1100 (5th Cir. 1970).
The object of the inquiry is not to count factors, but to
evaluate them.5 Tyler v. Tomlinson, 414 F.2d 844, 848 (5th Cir.
1969). The facts and circumstances of each case must be
considered, and no single factor is considered determinative.
See John Kelly Co. v. Commissioner, 326 U.S. 521, 530 (1946);
Segel v. Commissioner, 89 T.C. 816, 827 (1987). “The various
factors * * * are only aids in answering the ultimate question
whether the investment, analyzed in terms of its economic
reality, constitutes risk capital entirely subject to the
fortunes of the corporate venture or represents a strict debtor-
creditor relationship.” Fin Hay Realty Co. v. United States, 398
F.2d 694, 697 (3d Cir. 1968).
4(...continued)
the parties; (8) the debtor’s capitalization and use of the
funds; (9) the identity of interest between creditor and
stockholder; (10) whether interest was paid; (11) the ability of
the corporation to obtain loans from outside lending
institutions; (12) the extent to which the advance was used to
acquire capital assets; and (13) the failure of the debtor to
repay on the due date or to seek a postponement. See Estate of
Mixon v. United States, 464 F.2d 394, 402 (5th Cir. 1972).
5 In this case we have considered all of the factors set
forth in Estate of Mixon. Only certain of the factors, however,
are germane to the factual scenario presented in the record. We,
accordingly, analyze those factors that are significant to the
evaluation of whether petitioner’s advances were debt or equity.
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