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intention to create a debt, with a reasonable expectation of
repayment, and did that intention comport with the economic
reality of creating a debtor-creditor relationship”. Litton Bus.
Sys., Inc. v. Commissioner, 61 T.C. 367, 377 (1973).
In support of his “loan” argument, Mr. Sowards relies only
upon the one-page document and his testimony. Of course, “It is
well settled that we are not required to accept petitioner’s
self-serving testimony in the absence of corroborating
evidence.”26 Jacoby v. Commissioner, T.C. Memo. 1994-612; see
Geiger v. Commissioner, 440 F.2d 688, 689 (9th Cir. 1971), affg.
per curiam T.C. Memo. 1969-159; Niedringhaus v. Commissioner, 99
T.C. 202, 212 (1992). The mere declaration of intent does not
establish, without additional substantiating evidence, the
existence of a bona fide debt. Turner v. Commissioner, 812 F.2d
650, 654 (11th Cir. 1987), affg. T.C. Memo. 1985-159; Cordes v.
Commissioner, T.C. Memo. 1994-377.
The document, which is at best ambiguous, states that
certain of its terms and conditions are to remain secret. In the
event of Mr. Strong’s death, Mr. Sowards is to create a trust to
which will be transferred the “Account balance” of the principal
and accrued interest under “the terms and conditions of which are
private between Robert Strong and Ray Sowards, and not to be
26Mr. Sowards testified that he did not know the exact
amount that he allegedly borrowed from STL/Mr. Strong.
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