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obligations to pay a fixed or determinable sum of money. Sec.
1.166-1(c), Income Tax Regs. A gift or contribution to capital
does not constitute bona fide debt for the purposes of section
166. Calumet Indus., Inc. v. Commissioner, 95 T.C. 257, 284
(1990); Kean v. Commissioner, 91 T.C. 575, 594 (1988); Sec.
1.166-1(c), Income Tax Regs.
The taxpayer bears the burden of showing entitlement to
deductions and must show that bona fide debt existed and that the
debt became worthless in the year claimed. Rule 142(a); Dixie
Dairies Corp. v. Commissioner, 74 T.C. 476, 493 (1980).
Whether a transfer of funds from a shareholder to a
corporation constitutes bona fide debt is a question of fact
which must be decided on the basis of all the relevant facts and
circumstances in each case. Calumet Indus., Inc. v.
Commissioner, supra at 285; Dixie Dairies Corp. v. Commissioner,
supra at 493; Ga.-Pac. Corp. v. Commissioner, 63 T.C. 790, 795
(1975). Factors ordinarily considered include, but are not
limited to: (1) The names given to the documents that evidence
the purported loans; (2) the presence or absence of fixed
maturity dates with regard to the purported loans; (3) the likely
source of any repayments; (4) whether the taxpayer could or would
enforce repayment of the transfers; (5) any increase in
management participation as a result of the transfers; (6) the
status of the transfers in relation to debts owed to regular
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