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plus the fair market value of the property (other than money)
received. Sec. 1001(b). The amount realized from a sale or
disposition of property includes the amount of liabilities from
which the transferor is discharged as a result of the sale or
disposition, including a sale in foreclosure. Chilingirian v.
Commissioner, 918 F.2d 1251 (6th Cir. 1990), affg. T.C. Memo. 1986-
463.
Section 1221(2) provides that real property used in a trade or
business is not a capital asset (and therefore a loss from the
disposition of such property would be an ordinary loss).
Accordingly, we must determine whether the two 1-acre lots and the
airplane hangar were used in petitioner's trade or business.
The Supreme Court has stated that "to be engaged in a trade or
business, the taxpayer must be involved in the activity with
continuity and regularity and that the taxpayer's primary purpose
for engaging in the activity must be for income or profit."
Commissioner v. Groetzinger, 480 U.S. 23, 35 (1987). Petitioner
contends that he acquired the 1-acre lots and the airplane hangar
for his trade or business, which involved renting space for parking
and storing aircraft. We are not convinced that petitioner used
the airplane hangar or the two lots in any trade or business.
Petitioner failed to prove that he commenced a leasing or other
commercial endeavor with respect to the airplane hangar. To the
contrary, petitioner admitted that he occasionally used the hangar
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