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The real benefit that petitioner received was the transfer
of employees to locations as required by its computer business.
The transactions were structured to encourage employees to accept
petitioner's offer to transfer. The contracts of sale gave
petitioner a means to provide relocating employees their equity
in their residences before the residences were sold. This
enabled relocating employees to purchase new residences with a
minimum of delay. The contracts also relieved relocating
employees of the duplicate burden of paying the costs of a
mortgage, property tax, and other costs of home ownership for
both their new and former residences. However, relocating
employees were still legally responsible for the mortgage and tax
expenses of their former residences. Payments on the mortgages
or for other expenses relating to property ownership were for the
benefit of relocating employees and not for petitioner to acquire
an equity interest in the residences. The purported sales were
nothing more than a way for an employer to subsidize the costs of
its employees' transfers.
As part of the relocation program, petitioner protected its
relocating employees from the risk of loss on the sale of their
residences. The equity payments were not contingent on the sale
of the residences to third parties, and petitioner assumed the
risk of loss on the sale. Although petitioner assumed certain
risks of loss in connection with its employees' residences, in
substance, we find that petitioner was reimbursing the costs of
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