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generally would be treated as capital gains from the sale or
exchange of property. Petitioners, however, have not disputed
respondent’s characterization of the gas rebate payments as
ordinary income to petitioners. Striving for even-handed
treatment of geese and ganders, we deem petitioners to have
conceded this issue.
In sum, after a long roundabout to apply the statutory
analysis that the parties have neglected to favor us with, we
sustain respondent’s determination on this issue.
Issue 2. Basis in Towers Development
Background
Acquisitions of Land for Development
On May 30, 1985, as part of its plan to develop the Gulf
Highlands project, Towers Development purchased 60 acres of land
(the phase I land) from Mariners Cove of Panama City Beach, Inc.
(Mariners Cove).13 This property, located in Bay County, Florida,
was to become phase I of Gulf Highlands. On the same day, Briggs
and a business partner, John Lee Daniell (Daniell), purchased
from Mariners Cove approximately 40 acres of land (the 40 acres)
adjacent to the phase I land. Eventually, part of the 40 acres
was to become phase II of Gulf Highlands. To finance acquisition
of the 40 acres, Briggs and Daniell made a $50,000 cash
13 The record does not reveal the purchase price of the
phase I land or the manner in which Towers Development financed
the purchase.
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