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investment and merchant banking. The facts support petitioner on
that argument.
Petitioner and Thurmond credibly testified that they were in
the trade or business of investment and merchant banking. The
totality of the circumstances shows that they sought to obtain
financing in return for obtaining a percentage interest in
various Kirshner entities. Multiple Kirshner documents show that
petitioner was described as the managing director of Equisource
Group and responsible for obtaining financing as well as pursuing
possible acquisitions.
Petitioner was also slated to be on the board of directors
of Kirshner Global once financing was completed. He was listed
as executive vice president, chief financial officer, treasurer,
and director of Kirshner Content in the February 22, 1996,
confidential private placement memorandum. The Court concludes
that these activities were not merely investment activities or
the management of petitioner’s investment but were part and
parcel of petitioner’s trade or business. Thus, the Court finds
that petitioner was engaged in a trade or business with respect
to these expenses.
With respect to the claimed bad debts, petitioner must
establish that the debts had some value at the beginning of 2000
and became worthless by the end of the year. Milenbach v.
Commissioner, 106 T.C. 184, 204 (1996), affd. in part, revd. in
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