- 22 -
not apply here because respondent concedes that the real property
petitioners exchanged was of like kind.
Respondent contends that petitioners' subcontract with
Bolton Landfill to remove sand was a joint venture between
petitioners and Dakic and contends that this establishes that
petitioners exchanged unmined sand. We disagree; petitioners and
Dakic did not have a joint venture.
Respondent contends that we should decide whether
petitioners transferred assets other than land to the buyers
based on the substance of the transfer and not its form. We
disagree that the substance of this transaction differs from its
form.
We conclude that the unmined sand was not stock in trade or
property held primarily for sale for purposes of section 1031.
D. Conclusion
We conclude that petitioners conveyed only land and no other
assets in exchange for property worth $1.2 million. Petitioners
are entitled to defer recognition of gain on the $1.2 million
because they received like-kind property in exchange. Sec. 1031.
To reflect the foregoing,
Decision will be
entered for petitioners.
Page: Previous 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 Last modified: May 25, 2011