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he had in the past, although he "looked after" the property for
Mr. Burns.
Section 1221 provides:
For purposes of this subtitle, the term "capital asset"
means property held by the taxpayer (whether or not
connected with his trade or business), but does not
include--
(1) stock in trade of the taxpayer * * *;
(2) property, used in his trade or business, of a
character * * * subject to * * * depreciation * * *;
(3) a copyright * * *;
(4) accounts or notes receivable acquired in the
ordinary course of * * * business * * *;
(5) a publication of the United States Government
* * *;
Section 1222(3) provides: "The term 'long-term capital
gain' means gain from the sale or exchange of a capital asset."
(Emphasis added.)
There was no sale or exchange of any property by petitioner
during 1996. The title to the property discussed above had been
transferred, sold, or conveyed by petitioner to Mr. Burns in
1993. What occurred during 1996 between petitioner and Mr. Burns
was the relinquishment by petitioner of what petitioner contended
was an option for purchase of the property. That option was
predicated on a promissory note of $21,000 that petitioner had
executed in favor of Mr. Burns during 1993. There is no evidence
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