Amdahl Corporation and Consolidated Subsidiaries - Page 19

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          petitioner intended to acquire legal title to the residences at             
          some future time. Petitioner generally did not hold itself out as           
          the purchaser or owner of the residences.                                   
               Respondent contends that the parties entered into binding              
          contracts for the sale of the residences.  Respondent relies on             
          language in the contracts of sale that identifies the RSC as the            
          purchaser and the employees as the sellers and provides that the            
          RSC agrees to purchase and the employees agree to sell the                  
          residences.  However, the RSC's obligation to purchase the                  
          residences was conditional, and the contracts of sale were                  
          executory in nature.  The contracts of sale did not purport to              
          convey ownership of the residences to either petitioner or the              
          RSC.  Although in some circumstances an executory contract may              
          constitute a sale for Federal tax purposes, this is not one of              
               Relocating employees did not have a present, legally                   
          enforceable right to compel the RSC to purchase the residences.             
          Under the terms of the contract of sale, a relocating employee              
          agreed to convey title to the residence at the RSC's request to             
          the RSC or a person it designates.  The contracts delayed passage           
          of title to the RSC for 1 year from the date the parties entered            

               5 Even if the RSC is considered the buyer, the RSC's                   
          relationship with petitioner will not ipso facto result in the              
          ownership’s being attributed to petitioner for Federal tax                  

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Last modified: May 25, 2011