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c. Source of the Payments
If the source of the debtor’s repayment is contingent upon
earnings or is from a restricted source, such as a judgment
recovery, dividends, or profits, an equity investment is
indicated. Estate of Mixon v. United States, supra at 405;
Calumet Indus., Inc. v. Commissioner, 95 T.C. at 287-288; Dixie
Dairies Corp. v. Commissioner, 74 T.C. at 495. In such a case,
the lender acts “‘as a classic capital investor hoping to make a
profit, not as a creditor expecting to be repaid regardless of
the company’s success or failure.’” Calumet Indus., Inc. v.
Commissioner, supra at 287-288 (quoting In re Larson, 862 F.2d
112, 117 (7th Cir. 1988)). When circumstances make it impossible
to estimate when an advance will be repaid because repayment is
contingent upon future profits or repayment is subject to a
condition precedent, or where a condition may terminate or
suspend the obligation to repay, an equity investment is
indicated. Affiliated Research, Inc. v. United States, 173 Ct.
Cl. 338, 351 F.2d 646, 648 (1965).
Petitioner acknowledges that repayment of the advances was
dependent upon G�nther’s earnings. Therefore, the only question
is the weight to be given this factor. We conclude that this
factor favors respondent’s position and that it is entitled to
considerable weight because G�nther had no available source of
repayment other than its earnings and, during the years the
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