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applies here. The Solomons property was purchased by the
partnership, not contributed to it.
Under section 1034(a), the old residence must be "sold by" a
taxpayer claiming nonrecognition treatment. The Solomons house
was sold, along with the other partnership property, by Solomons,
not by petitioner. Maintaining continuity of title is a key to
receiving nonrecognition treatment under section 1034. See
Starker v. United States, 602 F.2d 1341, 1351 (9th Cir. 1979).
Title to the Solomons house was held in the name of Solomons,
along with the other partnership property. Petitioner's new
residence was titled in his and another's names. No continuity
of title exists here.
Petitioner argues that through an oral agreement with his
partners he gained an interest in the Solomons house. Neither of
the other Solomons partners corroborated petitioner's testimony.
Petitioner, Fischer, and a Delta representative, Douglass Parran,
Jr. (Parran), testified that each partner had the option to
receive one of the residential units to be built as part of the
development. Such an agreement would not constitute a transfer
to petitioner of title in the Solomons house. Fischer testified
that petitioner's use of the Solomons house was important to the
partnership during the construction phase from a security
standpoint and from a convenience standpoint (petitioner was
overseeing the construction). However, petitioner, Fischer, and
Parran also testified that, from the outset, Solomons intended to
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