Madeline Cook - Page 9

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               Petitioner reported the distributions from Cold Springs as             
          ordinary income on her tax return.  There is nothing in the                 
          record establishing that such reporting was incorrect.  Cold                
          Springs failed to file tax returns or prepare Schedule K-1 for              
          the years at issue.  If petitioner was entitled to capital gains            
          treatment for a portion of the distributions from Cold Springs,             
          then she should have caused Cold Springs to file a return and               
          accompanying Schedules supporting such treatment.  We hold that             
          petitioner has not shown her entitlement to capital gains                   
          treatment for the 1994 and 1995 distributions.  Accordingly, the            
          distributions are still ordinary income to petitioner.                      
               To reflect the foregoing,                                              
                                                  Decision will be entered            
                                             for respondent.                          

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Last modified: May 25, 2011