Donald DeCleene and Doris DeCleene - Page 22

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               WLC did not acquire any of the benefits and burdens of                 
          ownership of the Lawrence Drive property during the 3-month                 
          period it held title to that property.  WLC acquired no equity              
          interest in the Lawrence Drive property.  WLC made no economic              
          outlay to acquire the property.  WLC was not at risk to any                 
          extent with respect to the Lawrence Drive property because the              
          obligation and security interest it gave back on its purported              
          acquisition of the property were nonrecourse.  WLC merely                   
          obligated itself to reconvey to petitioner prior to yearend the             
          Lawrence Drive property with a substantially completed building             
          on it that had been built to his specifications and that pursuant           
          to prearrangement he was obligated to take and pay for.                     
               The parties treated WLC’s holding of title to the Lawrence             
          Drive property as having no economic significance.  The                     
          transaction was not even used as a financing device.  No interest           
          accrued or was paid on the nonrecourse note and mortgage, which             
          assured that petitioner would get back the Lawrence Drive                   
          property after it had been improved.  WLC had no exposure to real           
          estate taxes that accrued with respect to the property while WLC            
          held the title; all such taxes were to be paid by petitioner.  No           
          account was to be taken under the terms of the reacquisition                
          agreement of any value that had been added to the property by               
          reason of the building constructed in the interim.  The                     

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Last modified: May 25, 2011