- 63 - Therefore, petitioner’s transfer of the Rivercliff property to RFI in June 30, 2005, was not a bona fide repayment. See Commissioner v. Makransky, supra at 600-601. This factor indicates the parties did not intend to establish a debtor-creditor relationship at the time the funds were advanced. 7. Whether the Parties Conducted Themselves As If the Transaction Were a Loan The conduct of the parties may indicate the existence of a loan. Baird v. Commissioner, 25 T.C. 387, 395 (1955); Teymourian v. Commissioner, T.C. Memo. 2005-232; Morrison v. Commissioner, supra. Petitioner produced no evidence showing TPPL and petitioner conducted themselves in a manner indicating that TPPL’s transfer of $249,143 to SSI in 1998 was a loan. Petitioner also failed to produce evidence showing NCPL and petitioner conducted themselves in a manner indicating the total of $92,250 NCPL transferred to petitioner for the Rivercliff property’s farm operating expenses in 1998, 2001, and 2002 was a loan. Although petitioner executed a loan agreement, a promissory note, and a trust deed indicating the funds transferred to SSI for the development of the Rivercliff property in 1999, 2000, and 2001 were a loan, neither party abided by the terms of the loan agreement, the promissory note, or the trust deed.Page: Previous 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 NextLast modified: March 27, 2008