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how an allocation should be made between dealer and nondealer
assets in order to determine whether and to what extent the gain
on sale is entitled to installment treatment; (6) whether Howard
Berger and Alice Berger are liable for additional self-employment
tax for 1988 and 1989; and (7) whether Alice Berger is liable for
the section 6651(a) addition to tax or section 6662 accuracy-
related penalty for 1989.
After addressing the evidentiary questions, we hold that the
1988 return was a valid joint return and that petitioners used a
proper method of accounting for mausoleum crypt sales. As a
result, neither Howard Berger nor Alice Berger has taxable income
from Phase II mausoleum crypt sales for 1988. We allocate
cemetery income, including Phase II mausoleum crypt sales income,
between Howard and Alice Berger for 1989. We hold that the gain
on the sale of Woodbine is attributable in its entirety to Alice
Berger. After discussing the rules for determining the bases of
the Woodbine assets in the hands of Alice Berger, we use the rule
of Cohan v. Commissioner, 39 F.2d 540 (2d Cir. 1930), to
determine the portion of Alice Berger's Woodbine sale gain
entitled to installment treatment as a nondealer disposition,
leaving the details to a Rule 155 computation. We hold that
Howard and Alice Berger are both subject to self-employment tax
for 1988 and 1989, and that Alice Berger is not liable for the
section 6651(a) addition to tax or the section 6662 accuracy-
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