-27- Our agreement with petitioners that LeBloch’s transfers of money to Michelsen and NT were loans flows from our findings of fact that petitioners regularly advanced funds to each other without formal documentation and without formal terms, that the transfers in question were made with the expectation, belief, and intent that they be repaid, that the transfers in question were made incident to the transferee’s need for operating funds, and that the transfers in question were repaid by the transferee shortly after receipt.10 LeBloch lent $95,000 for use (and that was used) in the business of the Nature’s Touch shops, and, of that amount, $35,000 was repaid in 1997, $15,000 was repaid in 1998, $20,000 was repaid in 1999, and $25,000 was repaid after 1999. In addition, petitioners had an informal understanding that either of them would advance funds to the other without formal terms and that the one for whose benefit the funds were advanced would repay them. In fact, as to LeBloch, it was not uncommon for him regularly to pay a common expense in full and then contemporaneously receive reimbursement from Michelsen for her share of that expense. Nor was it uncommon for LeBloch regularly to pay out of his personal funds expenses of a Nature’s Touch shop and then seek and obtain reimbursement from the shops 10 Because respondent makes no assertion that LeBloch’s transfers were contributions of equity rather than loans, we do not consider that question. See Metrocorp, Inc. v. Commissioner, 116 T.C. 211, 217 (2001).Page: Previous 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 NextLast modified: November 10, 2007