- 10 - Issue 3. 1987 Properties Respondent determined that the losses petitioners sustained in 1987 for the McCandless, Killingsworth, Webb, and Bordelon properties in the amounts of $90,626, $179,765, $72,069 and $689,703, respectively, were long-term capital losses. Petitioners assert that these amounts are ordinary losses.5 During 1984, petitioner acquired his interest in each of the 1987 properties. Each of these properties was located in the area surrounding Austin, Texas. Each of these properties was foreclosed in 1987. Petitioners reported the losses sustained on each of the 1987 properties as ordinary on their 1987 Federal income tax return. Respondent determined that these losses were capital losses because the 1987 properties were not held by petitioner for sale to customers in the ordinary course of a trade or business. Petitioners assert that petitioner was in the trade or business of acquiring, developing, and selling real estate for profit, and that each of these properties was held by petitioner for sale to customers in the ordinary course of this trade or business. We agree with respondent. 5 In addition, petitioners sustained a loss of $36,274 in 1987 on a parcel of real property known as 3-Corners Ranch. Petitioners concede that the loss incurred on 3-Corners Ranch is a capital loss.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 Next
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