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Regs. The Nationsbanc loan was guaranteed by Mr. Forsythe, Indeck
Energy, and Indeck Power. Indeck Energy and Indeck Power have no
ownership interests in either Indeck Overseas or IPO II. Mr.
Forsythe, on the other hand, is at least a majority owner in
Indeck Energy, Indeck Power, and Indeck Overseas. Even though
Indeck Overseas did not guarantee the Nationsbanc loan, we must
inquire into whether the guaranty by Mr. Forsythe, Indeck Power,
or Indeck Energy can be attributed to Indeck Overseas.
Petitioner argues that the liability incurred as a result of
the purchase of the aircraft is recourse with respect to each
member: fully recourse as to Mr. Forsythe as a result of the
Forsythe guaranty, and fully recourse as to Indeck Overseas as a
result of its being related to Indeck Energy, a guarantor,
through Mr. Forsythe’s common ownership.
Respondent argues that the entire recourse liability
incurred with the purchase of the aircraft should be allocated to
Mr. Forsythe because: (1) Nationsbanc had no recourse against
Indeck Overseas for the loan; and (2) for purposes of determining
the allocation of the liability, Mr. Forsythe and Indeck Overseas
cannot be related parties, and, therefore, Indeck Overseas and
Indeck Energy cannot be considered related persons through the
common ownership by Mr. Forsythe.
The regulations define a “related person” as a person having
a relationship to a partner which is specified in section 267(b)
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Last modified: May 25, 2011