Thomas C. Sandoval, Jr. and Bobbie J. Sandoval - Page 12




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               We do not have sufficient information to estimate how much             
          petitioners paid for the storage addition that was completed in             
          1982.  Also, petitioners have failed to show that they did not              
          include the cost of the storage addition on the depreciation                
          schedule attached to their 1982 return, for which respondent                
          already concedes an allowance for depreciation.  Finally,                   
          petitioners have not shown that they did not fully depreciate the           
          cost of the storage addition before 1985.  Thus, petitioners may            
          not increase their basis in the Hoefgen Avenue property for 1985            
          or any later year to include any costs of building the storage              
          addition.                                                                   
          B.   Whether Petitioners Have Basis in the Hoefgen Avenue                   
               Property for Outdoor Advertising Signs                                 
               Petitioners contend that the two outdoor advertising signs             
          on the Hoefgen Avenue property had a future contract value of               
          $130,000 and that we should increase their basis in the Hoefgen             
          Avenue property by that amount.  We disagree.                               
               The basis of property is generally its cost.  See sec. 1012;           
          Better Beverages, Inc. v. United States, 619 F.2d 424, 428 (5th             
          Cir. 1980); Winn-Dixie Montgomery, Inc. v. United States, 444               
          F.2d 677, 683-684 (5th Cir. 1971).  Future contract value is not            
          the cost of the two outdoor signs.4  There is no evidence of the            

               4  Future contract value is not a proper grounds for                   
          computing gain.  See sec. 1012; Better Beverages, Inc. v. United            
          States, 619 F.2d 424, 428 (5th Cir. 1980); Winn-Dixie Montgomery,           
                                                              (continued...)          





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