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because petitioner and the Pughs owned the rental real estate as
tenants in common. See id.
The regulations and relevant case law indicate that the
distinction between mere coowners and coowners who are engaged in
a partnership lies in the degree of business activity of the
coowners or their agents. Estate of Winkler v. Commissioner,
supra; Gabriel v. Commissioner, supra; Marinos v. Commissioner,
supra.
On the basis of the credible testimony of petitioner and
Pugh, we find that petitioner and the Pughs were engaged in a
rental real estate venture involving the Oak Street properties.
Petitioner and Pugh testified, repeatedly, that their intent was
to form a "50-50" partnership and share all profits and losses
equally. Not only was this their intent, but they did in fact
share all profits and expenses relating to the Oak Street
properties equally. The degree of business activity exhibited by
petitioner and the Pughs in conducting their rental real estate
activities causes us to characterize the relationship as a
partnership. Thus, on the basis of all the facts and
circumstances of this case, we find that petitioner in good faith
and acting with a business purpose intended to join together with
the Pughs in the present conduct of an enterprise. See
Commissioner v. Culbertson, 337 U.S. 733 (1949); Luna v.
Commissioner, supra.
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