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Petitioner entered into contracts with subcontractors, who built
the residences. The 14 houses were constructed in two phases,
the first phase of 6 houses (construction commenced on October
17, 1986) and the second phase of 8 homes (construction commenced
on June 25, 1987). Petitioner sold the 14 homes from July 21,
1987, through March 31, 1989, as follows:
Date of Sale Address Selling Price
07/21/87 1202 E. 10th Street $79,950
09/30/87 1050 Pennsylvania Avenue 87,950
12/22/87 1070 Pennsylvania Avenue 77,950
01/08/88 1090 Pennsylvania Avenue 87,950
09/16/88 1010 Pennsylvania Avenue 89,500
09/23/88 1110 Pennsylvania Avenue 77,950
11/17/88 1202 E. 11th Street 79,950
11/22/88 1201 E. 11th Street 77,550
01/27/89 1130 Pennsylvania Avenue 80,950
02/10/89 1120 Pennsylvania Avenue 89,950
02/28/89 1030 Pennsylvania Avenue 77,000
03/06/89 1100 Pennsylvania Avenue 87,950
03/13/89 1140 Pennsylvania Avenue 89,950
03/31/89 1150 Pennsylvania Avenue 89,950
Petitioner classified the cost of the 14 houses on the Beaumont
Property under cost of houses sold, and classified income from
their sale as ordinary income.
Exchange Property--Tract No. 22332
The tentative map for Tract No. 10018 expired in 1983. In
regard to the remaining 48 lots of the Beaumont Property
(hereinafter referred to as the Exchange Property4) in Tract No.
10018, petitioner resubmitted a tentative map in March 1986.
4 Exchange Property is the Beaumont Property minus the 14
lots created by the final map of Tract No. 10018-1.
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