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Petitioner did not advertise for customers in the course of
his lending and financing activities. There is no evidence of
record that he held a reputation in the community as a lender or
as a guarantor. As part of his lending and financing activities,
petitioner lent money only to companies in which he held an
interest. He guaranteed loans only with respect to those same
companies. Petitioner points to no loans or guaranties involving
unrelated parties or parties with whom he had no direct
involvement as an investor.21 Petitioner did not actively pursue
loan or guaranty opportunities with respect to either the general
public or within his community of companies. Petitioner made
loans or guaranties when the need arose with respect to one of
his companies. Petitioner devoted most of his time to IBC and
his other activities. He has not shown that he devoted any
significant time to WMG, and he was not paid for any of his
services thereto. The record does show a long history (from the
1960s to the 1990s) of loans and guaranties petitioner made to
companies in which he held an interest. However, that history is
broken and sporadic, and it certainly is by no means continuous.
See United States v. Henderson, 375 F.2d at 41.
21Lending activities confined to corporations in which the
taxpayer has an interest, generally, do not give rise to a trade
or business of making loans. Putoma Corp. v. Commissioner, 66
T.C. 652, 674 n.33 (1976), affd. 601 F.2d 734 (5th Cir. 1979).
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