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Background
This case was submitted fully stipulated. The stipulation
of facts and the first supplemental stipulation of facts are
incorporated herein by this reference. Petitioners resided in
Greenwich, Connecticut, at the time they filed their petition.
Petitioners were calendar year, cash basis taxpayers.
Petitioner Charles H. Davison is a certified public
accountant. During 1979, he was head partner of the accounting
firm Peat, Marwick & Mitchell, where he was associated with
Samuel J. Esposito and John L. Vitale, who were also partners.
On February 1, 1979, Messrs. Davison, Esposito, and Vitale
formed White Tail, a general partnership organized under Illinois
law, for the purpose of entering into the agricultural business
of acquiring, cultivating, and selling farm properties. Each of
the partners had a one-third interest in the profits, losses, and
distributions of White Tail. White Tail reported its income on a
calendar year basis using the cash method of accounting.
On or about March 16, 1979, White Tail acquired
approximately 11,000 acres of real property located in Hyde
County, North Carolina, and certain related personal property.
On or about May 2, 1980, White Tail acquired approximately 7,747
acres of real property located in Hyde and Tyrrell Counties in
North Carolina.
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Last modified: May 25, 2011