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contends, or ordinary losses, as petitioner contends. To
prevail, petitioner must show that she held the lots for sale to
customers in the ordinary course of her trade or business. See
sec. 1221(1). We hold that petitioner's losses were ordinary
losses.
Unless otherwise indicated, section references are to the
Internal Revenue Code in effect for the years in issue. Rule
references are to the Tax Court Rules of Practice and Procedure.
FINDINGS OF FACT
Some of the facts have been stipulated and are so found.
A. Petitioner
Petitioner lived in Scottsdale, Arizona, when she filed the
petition in this case. She was 70 and 71 years old during the
years at issue. Her husband, J.W. Hancock (Hancock, or her
husband), was 75 years old when he died on December 31, 1985.
Petitioner has two sons, Trevor Hancock and Mark Hancock,
who are real estate brokers and developers. Petitioner's nephew,
Greg Hancock, is also a real estate developer.
B. Petitioner's Involvement in Real Estate
Petitioner began working with her husband in the real estate
business in 1957 or 1958 in California. Petitioner and her
husband moved to Arizona in the 1960's. They formed a publicly
traded company called J.W. Hancock, Inc. Petitioner managed its
day-to-day operations. The company subdivided and developed land
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