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The policy considerations and rule of construction
concerning what constitutes capital assets have been explained as
follows:
The preferential treatment afforded by the capital
gains provisions, 26 U.S.C.A. secs. 1201-1202, 1221-
1223, was designed “to relieve the taxpayer from * * *
excessive tax burdens on gains resulting from a
conversion of capital investment * * *.” Burnet v.
Harmel, 287 U.S. 103, 106, 53 S.Ct. 74, 75, 77 L.Ed.
199. In Commissioner of Internal Revenue v. Gillette
Motor Transport, Inc., 364 U.S. 130, 134, 80 S.Ct.
1497, 1500, 4 L.Ed.2d 1617, the Court held that it was
“the purpose of Congress to afford capital-gains
treatment only in situations typically involving the
realization of appreciation in value accrued over a
substantial period of time, and thus to ameliorate the
hardship of taxation of the entire gain in one year.”
Commissioner of Internal Revenue v. P.G. Lake, Inc.,
supra; Burnet v. Harmel, supra. * * * [Wiseman v.
Halliburton Oil Well Cementing Co., 301 F.2d 654, 658
(10th Cir. 1962).]
See also Freese v. United States, 455 F.2d 1146, 1150 (10th Cir.
1972); Elliott v. United States, 431 F.2d 1149, 1155 (10th Cir.
1970).
As we have previously explained, see Foy v. Commissioner,
84 T.C. 50, 65-70 (1985), no single definitive explanation is
available of what types of property qualify as capital assets
under section 1221.
Over the years, court decisions have recognized limitations
on the types of property which qualify as capital assets under
section 1221. In Corn Prods. Ref. Co. v. Commissioner, 350 U.S.
46, 51 (1955), assets that were an integral part of a taxpayer's
business were held not to qualify as capital assets. In that
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