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Petitioners did not report any gain from the sale of the
land on their 1990 joint Federal income tax return. Petitioners'
1990 return was prepared by their accountant, Ms. Georgina M.
Alcover, and filed on November 21, 1991, 7 months after the April
15 deadline.
In making the decision to exclude the gain from the sale of
the land on their 1990 Federal Income tax return, petitioners
relied upon a paragraph of a brochure prepared by Century 21,
which stated that a person over the age of 55 could "keep all of
the proceeds on the sale of his or her property" to use during
retirement.3 The article, which was entitled "Tax Advantages
for Homeowners", dealt entirely with the sale of homes used as
primary residences.
OPINION
Respondent determined that petitioners are required to
recognize gain on the sale of the Fort Lauderdale property under
the general rule of section 1001(c). Petitioners assert that the
gain is not taxable because of either the deferral provisions
under section 1034(a) or the one-time exclusion of section
121(a). The Commissioner's determinations in a notice of
deficiency generally are presumed correct, and the taxpayer bears
the burden of proving that those determinations are erroneous.
3 Century 21 is a realty corporation. Its February 1990 issue
of The Prospector News contained an article entitled "Tax
Advantages for Homeowners".
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