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Florida. He testified that, if he could have sold the 12 parcels
in 1987 for $10 million in cash, he would have done so. He
testified that he viewed the $21 million, no downpayment price
agreed to by Ampel as a “speculative price”. On March 2, 1989,
when petitioner sold the 1987 Ampel notes to Floridama, Ampel was
in default on those notes. Adding the unpaid, accrued interest
to the $21 million principal amount of the 1987 Ampel notes
results in an unpaid, total obligation of almost $23.5 million.
The Floridama note was in the principal amount of $19.3 million
and Floridama paid petitioner cash of $201,159. We do not
believe that the 1987 Ampel notes were worth their face amount,
nor do we believe that the Floridama note was worth its face
amount. The 1987 Ampel notes were eventually exchanged by
Floridama to Ampel for the Floridama note (received by Ampel from
petitioner), and petitioner ended up with the 1991 Ampel notes,
which, as of 1997, had not been paid. Relying principally on
petitioner’s testimony, we find, as stated, that the fair market
value of the Floridama note, as of March 2, 1989, was $7 million.
Making the necessary allocations to interest, petitioner
calculates that the amount realized on disposition of the 1987
Ampel notes was $6,448,806, which, given petitioner’s adjusted
basis in those notes of $6,940,895, means that petitioner
realized a loss of $492,089, on the disposition of the 1987 Ampel
notes, and we so find.
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