Kristie owns $35\%$ of BCD Inc., which has a December $31$ year end. She is also an employee of the company. On March $31$st of Year $1,$ she purchased her shares of BCD from the company for $$150,000.$ BCD lent her all the funds for the share purchase at an interest rate of $2\%,$ paid on December $31$st each year. She is required to repay the loan at a rate of $$25,000$ each January $1.$ Loans of a similar nature are available to all employees of BCD Inc.

On June $1$st of Year $1,$ BCD loaned Kristie $$75,000$ to renovate her personal office and purchase office furniture. She isn$$t required to repay any amount of the loan in Year $1$ or Year $2.$ At the end of Year $3,$ Kristie repaid $$25,000$ of the loan.

REQUIRED: Calculate the income tax implications of these loans to Kristie in Year $1,$ Year $2,$ and Year $3.$ Assume the prescribed rate of interest for shareholder loans is $3\%$ in all years

You may simplify the imputed interest calculations by using months as opposed to days. Assume any accrued interest is paid at the end of each year.