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examining several of petitioners' returns, however, which were
admitted in evidence, we find that many of the parcels of real
property which petitioners owned were reported as capital gains
upon their disposition. Therefore, although petitioners have
bought and sold various parcels of real property over the years,
many parcels were treated as investment properties. Furthermore,
petitioner was involved in an investment called the MMJ Ventures,
which also held certain properties for investment. This does not
support the proposition that petitioners were engaged in a trade
or business. Cf. Legg v. Commissioner, 57 T.C. 164, 169 (1971),
affd. per curiam 496 F.2d 1179 (9th Cir. 1974).
Petitioners rely on Morley v. Commissioner, supra, where the
Court held that a single transaction for the sale of a piece of
real property qualified as a trade or business. See also S & H,
Inc. v. Commissioner, supra. The Court stated that in certain
situations this rationale may apply if "at the time the property
was acquired by the taxpayer, he intended promptly to resell the
property and the objective facts show that he proceeded to
attempt to implement that intent--in short, that the taxpayer's
purpose was bona fide." Morley v. Commissioner, supra at 1211.
Petitioner testified that the real estate market in the
Austin, Texas, area during the early 1980s was very active and
that "'investors' * * * plus the local types, were all looking
for land that could be a quick profit or a quick development".
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