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54, 63 (1978). Eligibility for this treatment is circumscribed
by a number of specific statutory requirements. For purposes of
this case, we need be concerned only with the threshold
requirement that there be an “exchange” of property. We hold
that petitioners’ transactions did not constitute an exchange.
An exchange ordinarily requires a “reciprocal transfer of
property, as distinguished from a transfer of property for a
money consideration only”. Sec. 1.1002-1(d), Income Tax Regs. A
sale for cash does not constitute an exchange even though the
cash is immediately reinvested in like property. Coastal
Terminals, Inc. v. United States, supra at 337; see also Bell
Lines, Inc. v. United States, 480 F.2d 710, 714 (4th Cir. 1973);
Carlton v. United States, 385 F.2d 238, 242 (5th Cir. 1967);
Rogers v. Commissioner, 44 T.C. 126, 136 (1965), affd. per curiam
377 F.2d 534 (9th Cir. 1967).
Petitioners purchased the Big Sur property from Marcia
D’Esopo with a cash downpayment and assumed a note for the
balance of the purchase price. Almost a year later, they sold
the Pacific Grove property to the Elvins and received cash.
Although petitioners may have intended to effect a section 1031
exchange, there is no evidence that either Marcia D’Esopo or the
Elvins agreed to participate in an exchange of property. Indeed,
petitioner husband testified at trial that it was only after
receiving an offer on the Pacific Grove property -- almost a year
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