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paid any expenses with respect to the warehouse in any of the
years in issue.
On June 16, 1993,5 Christopher and Brenda borrowed $220,000
from the Oklahoma Bank (loan 91850). Cox Tomato, acting through
Christopher in his official capacity as president, was a
signatory on the loan. Christopher, Brenda, and Cox Tomato
executed an installment note for $220,000. Christopher and
Brenda also executed a mortgage in favor of the Oklahoma Bank
giving the bank a security interest in the warehouse.
Christopher used approximately $70,000 of the loan proceeds to
pay off the first mortgage on the warehouse and gave
approximately $148,000 of the remaining loan proceeds to Cox
Tomato to fund its operations.
The terms of the installment note required 60 monthly
payments. Christopher treated loan 91850 as his personal debt
and made at least some payments on it. Neither Gregory nor
Deborah made any payments on loan 91850 in any of the years in
5Because no deficiency has been asserted for the 1993
taxable year, we may not determine an overpayment or underpayment
of tax for that taxable year. Sec. 6214(b); Alford v.
Commissioner, 800 F.2d 987, 988 (10th Cir. 1986), affg. 84 T.C.
1308 (1985). We may, however, examine the facts and transactions
of the 1993 taxable year to the extent necessary to correctly
determine petitioners’ tax liabilities for the years at issue.
Sec. 6214(b); Lone Manor Farms, Inc. v. Commissioner, 61 T.C.
436, 440-441 (1974), affd. without published opinion 510 F.2d 970
(3d Cir. 1975).
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