- 35 -
fifty-fifty chance of survival. In November 1988, Mr. Baker
underwent surgery, which was followed by chemotherapy. Mr. Baker
testified that as a result of contracting cancer, he made a
decision that petitioner would discontinue subdividing land;
thereafter, petitioner built some homes on existing lots but no
longer subdivided raw land into lots.
As petitioner's main decision maker, Mr. Baker's health
impacts petitioner, but we are examining petitioner's intentions
in regard to the Exchange Property in 1989 and not necessarily
petitioner's decisions regarding other aspects of its trade or
business.
We first consider Mr. Baker's statement that he spent only
20 percent of his time at the time of exchange working for
petitioner, while he spent the other 80 percent of his time
supervising the food operations of Baker's Burgers, Inc. Mr.
Baker and Terry Talley managed petitioner's construction
activities. Because petitioner subcontracted all of its
construction work, the actual number of permanent employees
employed by petitioner or Mr. Baker's diminished time with
petitioner is of little significance.
Petitioner presented no evidence of actions of its Board of
Directors to corroborate Mr. Baker's statement that petitioner no
longer was subdividing land. Instead, we note that on Form 1120,
for the taxable years 1988, 1989, 1990, and 1991, petitioner
Page: Previous 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 NextLast modified: May 25, 2011