111 T.C. No. 11
UNITED STATES TAX COURT
RICHARD D. FRAZIER AND YVONNE FRAZIER, Petitioners v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 3343-96. Filed September 22, 1998.
Ps owned investment real property subject to a
recourse mortgage. Upon default, the property was
acquired by the lender at a foreclosure sale. At the
foreclosure sale, the lender bid in an amount for the
property which was in excess of the property's fair
market value. R determined that the "amount realized"
by Ps at the foreclosure sale was the amount bid in by
the lender, regardless of fair market value.
Held: P's "amount realized" at the foreclosure
sale is the property's fair market value.
Held, further: Bifurcated analysis used to
determine income tax consequences of "amount realized"
and income from cancellation of indebtedness.
Held, further: Ps are not liable for accuracy-
related penalty determined by R.
Michael L. Cook and William R. Leighton, for petitioners.
Page: 1 2 3 4 5 6 7 8 9 10 11 12 Next
Last modified: May 25, 2011