Jim Wood Land Clearing Co., Inc. - Page 2

                                        - 2 -                                         

          All section references are to the Internal Revenue Code in effect           
          for the years in issue, and all Rule references are to the Tax              
          Court Rules of Practice and Procedure.                                      
               After concessions by the parties, the remaining issue for              
          decision is whether, for 1993 and 1994, petitioner may reduce its           
          gross income by expenses paid to construct two houses.                      
                                  FINDINGS OF FACT                                    
               Petitioner is a Florida corporation whose principal place of           
          business was in Lake Placid, Florida, at the time the petition              
          was filed.  Petitioner does land clearing and demolition work in            
          Dade County, Florida.  During the years in issue, Allen Wood was            
          petitioner's president and sole shareholder.                                
               Allen Wood owned two unimproved lots in Highlands County,              
          Florida.  In 1993 and 1994, petitioner expended $128,025 and                
          $35,194, respectively, to construct two single-family houses on             
          Allen Wood's lots.  In calculating its 1993 and 1994 gross                  
          income, petitioner subtracted these expenditures as cost of goods           
               On February 1, 1994, Allen Wood formed Wood Developers, Inc.           
          (Wood Developers).  He was president and a 50-percent shareholder           
          of the corporation.  In March 1994, Allen Wood transferred to               
          Wood Developers his interest in the improved lots and Wood                  
          Developers sold both properties.  On its 1994 Federal tax return,           
          Wood Developers reported the income from the sale of the                    

Page:  Previous  1  2  3  4  Next

Last modified: May 25, 2011