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shareholder must have incurred the assumed liability to acquire
the transferred stock; and (4) the transferred stock must not
have been acquired from a person whose stock was attributable to
the shareholder under the section 318 attribution rules.
In the present controversy, respondent challenges only the
third of the elements enumerated above. Accordingly, we focus
our analysis on whether the $174,133.20 liability released by
COST was incurred by Mr. Combrink to acquire the LINKS stock.
Petitioners bear the burden of proving that this question should
be answered in the affirmative. See Rule 142(a).
Of the $174,133.20 assumed by COST, the stipulated evidence
explicitly establishes only that $72,263.38 was transferred to or
used for the benefit of LINKS. Remittances on August 31 and
December 20, 1995, of $15,729.17 and $11,228.64, respectively,
were applied to repay creditors for services and property related
to the LINKS business. Then, in 1996, payments totaling
$45,305.57 were made directly to LINKS. However, the parties
also agreed that all nine accounts receivable transactions,
including those on May 26 and December 29, 1995, were
consistently treated as loans from COST to Mr. Combrink, followed
by loans from him to LINKS. On the basis of such consistency, we
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