Larry L. Beeler and Cynthia J. Beeler - Page 17

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            petitioners sold goodwill and a going-concern to the buyers.                                
            Respondent points out that petitioners had a good business                                  
            location and customers and that the contract for exchange                                   
            required petitioners to operate and maintain their business.                                
                  Going-concern value is the ability of a business to produce                           
            income even though there has been a change in ownership; goodwill                           
            is the existence of preexisting business relationships which may                            
            be expected to continue indefinitely.  Ithaca Indus., Inc. v.                               
            Commissioner, 97 T.C. 253, 264 (1991), affd. 17 F.3d 684 (4th                               
            Cir. 1994).  Whether goodwill and going-concern value exist is a                            
            question of fact.  Id. at 263-264.                                                          
                  The parties did not discuss transferring or exchanging the                            
            sand mine business.  Petitioners did not transfer any customer                              
            lists to the buyers.  Petitioners did not transfer management                               
            systems or records to the buyers.  The record does not show that                            
            petitioners had any property rights to the business name.                                   
            Petitioners did not charge the buyers for transferring rights to                            
            use the business name.  Dakic, Burke, Gilmore, and Mrs. Beeler                              
            testified that petitioners did not transfer to the buyers                                   
            goodwill, going-concern value, or an ongoing business.  The                                 
            documents conveying property from petitioners to the buyers did                             
            not refer to goodwill or going-concern value.  We conclude that                             
            any goodwill or going-concern value transferred by petitioners to                           
            the buyers was de minimis.                                                                  

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