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sales or sales-related activity over a period of time; the volume
and frequency of sales; the extent to which the taxpayer or his
agents have engaged in sales activities by developing or
improving the property, soliciting customers, and advertising;
and the substantiality of sales when compared to other sources of
[the] taxpayer's income." Polakis v. Commissioner, 91 T.C. 660,
670 (1988). No one of these factors, however, is determinative.
Id.
The factors set forth in Polakis weigh against Mr. Finnegan.
As to the nature and purpose of the construction of the Acapulco
house, a lack of business intent can be inferred from
petitioners' ownership of the Acapulco house for more than 5
years after Mr. Finnegan completed construction. Mr. Finnegan's
sales were not continuous, frequent, or voluminous (he sold only
one home during the last 20 years which he constructed). Mr.
Finnegan never hired a real estate agent or broker, and his
efforts to sell the Acapulco house were limited to putting a "for
sale" sign in front of the house and running a classified
advertisement in a local newspaper. Petitioners have not offered
any credible explanation why the Acapulco house remained unsold
at the time of trial (5 years after Mr. Finnegan completed its
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