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references are to the Internal Revenue Code, as amended, and all
Rule references are to the Tax Court Rules of Practice and
Procedure.
Background
The parties submitted the instant case fully stipulated,
without trial, pursuant to Rule 122. The parties’ stipulations
of fact are hereby incorporated by reference and are found as
facts in the instant case. At the time of filing the petition,
petitioner resided in Glastonbury, Connecticut.
During 1996, petitioner received stock of PhyMatrix
Corporation (PhyMatrix) and CareMatrix Corporation (CareMatrix)
which had an aggregate value of $1,675,000 at the time of
receipt.1 Petitioner incurred a Federal income tax liability of
$621,980 related to the receipt of the stock.2 Petitioner
borrowed from CareMatrix an amount equal to the Federal income
tax liability (the loan), pledging 57,248 shares of PhyMatrix
common stock (the collateral) as security for the loan. The loan
and the pledge of the collateral are hereinafter collectively
referred to as the loan transaction.
1The record does not reveal the separate amount or value of
the CareMatrix stock or the value of the PhyMatrix stock at the
time of receipt by petitioner.
2Petitioner appears to have taken an aggregate basis in the
stock of both CareMatrix and PhyMatrix equal to the aggregate
$1,675,000 value of these stocks at the time of receipt.
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