-2-
defer recognition of gain from the sale of their former principal
residence under section 1034(a) when title to their new residence
was acquired by the parents of petitioner James De Ocampo, and (2)
whether petitioners are liable for an accuracy-related penalty
under section 6662(a).
All section references are to the Internal Revenue Code for
the year under consideration. All Rule references are to the Tax
Court Rules of Practice and Procedure.
FINDINGS OF FACT
Some of the facts have been stipulated and are so found. The
stipulation of facts and the attached exhibits are incorporated
herein by this reference.
Petitioners, husband and wife, resided in Livermore,
California, at the time they filed their petition. They filed a
joint Federal income tax return for 1989, the year under
consideration. The return shows Mr. De Ocampo's occupation as a
lithographer, and Mrs. De Ocampo as self-employed, having a
printing business. Their total combined income for 1989 was
$26,780.
On October 14, 1989, petitioners signed a deposit-receipt and
purchase contract for the purchase of their current residence at
1007 Montclair Court in Livermore (Montclair property) for
$300,000. At the time, petitioners resided at 5017 Curtis Street
in Freemont, California (Curtis property). After they signed the
contract, petitioners encountered credit and financial problems in
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