-8-
and five in 1991.1 Petitioner paid real estate commissions of
$13,653 in 1987, $2,110 in 1990, $23,244 in 1991, and $750 in
1992.
After 1986, petitioner sometimes worked in an office at Mark
Hancock's place of business. She paid no rent to him. She had
no other real estate office.
Petitioner has not subdivided or rezoned any property, made
offsite improvements, or installed water and sewer lines on any
property since she liquidated Hancock Enterprises. From 1987
through the years in issue, petitioner had no advertising
expenses. After she received the lots in liquidation, petitioner
regularly met with Gorman to discuss whether to acquire more
property.
2. Sales of Lots
From 1987 to 1996, petitioner sold 47 of the 48 lots that
she had acquired in the liquidation as follows:
Number of Sale Economic Tax
Year lots sold Cost Basis price gain loss
1987 7 $222,395 $499,000 $397,135 $174,741 ($230,972)
1988 none -- -- -- -- --
1989 2 28,826 155,000 145,000 116,174 (132,880)
1990 3 54,396 193,000 165,200 110,804 (165,782)
1991 13 482,644 871,000 688,000 230,926 (247,805)
1992 11 230,258 753,000 488,670 258,412 (299,807)
1993 4 53,491 355,000 190,000 136,509 (207,850)
1994 4 43,906 370,000 215,000 171,094 (166,599)
1995 2 28,826 150,000 100,000 71,174 (124,996)
1996 1 14,897 75,000 50,000 35,103 (47,759)
Total 47 1,159,639 3,421,000 2,439,005 1,304,937 (1,624,450)
1 The record contains no evidence that petitioner listed
property for sale with any realtor from 1992 to 1994.
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