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lease agreement, petitioner leased it, along with other medical
equipment, to KCPI, and as rent KCPI paid the bank loan payments
attributable to the purchase of the podiatry practice.
Petitioner testified that in years subsequent to 2001, KCPI’s
rent increased, but he produced no documentary evidence to
support this testimony.
The facts as presented support respondent’s argument that
petitioner did not invest in or purchase the medical equipment.
First, the Purchase Agreement between Dr. Karason and Dr. Flom
did not mention petitioner’s name, indicate that the medical
equipment was assigned to petitioner, or state that petitioner
was going to purchase the equipment. Second, Dr. Karason
testified that if not for the funds provided by petitioner, he
could not have paid the purchase price for the podiatry practice.
Third, the loan was secured with KCP’s property (Petitioner’s and
Dr. Karason’s partnership). Fourth, the promissory note on the
loan stated the loan was for the purpose of “BUSINESS: BUSINESS,
PURCHASE MEDICAL PRACTICE”. Fifth, Dr. Karason’s professional
corporation, KCPI, paid the monthly loan payments to the bank,
not petitioner.
Petitioner testified that his and Dr. Karason’s attorney and
accountant advised them that they did not need to enter into a
written agreement to either assign and purchase the medical
equipment or to lease the equipment to KCPI because petitioner
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