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The relative paucity of purchases and sales, coupled with
the other factors discussed herewith, suggests that the real
property was peripheral to the business of operating Ridgemark
Golf and Country Club. Pritchett v. Commissioner, 63 T.C. 149,
164 (1974).
Accordingly, unit 10 was held for a relatively long period
of time and was acquired for investment purposes.
2. The Extent and Nature of the Taxpayer’s Efforts To Sell the
Property
Ridgemark and Paullus sought to sell assets in order to
concentrate on developing a golf resort in Paicines. The
question is whether there were any acts of sales promotion on the
part of Ridgemark or its agents. For example, improving and
developing the land is a possible avenue to promote sales. See
Reithmeyer v. Commissioner, supra at 813 ("The obvious reason for
the platting and subdividing was to attract buyers."). The Fifth
Circuit Court of Appeals in Estate of Barrios v. Commissioner,
265 F.2d 517 (5th Cir. 1959), revg. 29 T.C. 378, 383 (1957),
while reversing the Tax Court for other reasons, agreed with the
general principle that improvement and development of land was an
avenue to promote sales. The Court of Appeals stated:
The idea of selling a large tract of land in lots
embraces necessarily the construction of streets for
access to them, the provision of drainage and the
furnishing of access to such a necessity as water. It
is hardly conceivable that taxpayer could have sold a
lot without doing these things. To contend that
reasonable expenditures and efforts, in such necessary
undertakings are not entitled to capital gains
treatment is to reject entirely the established
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