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properties, and that petitioner used the proceeds from the
Hoefgen Avenue sale to buy partnership interests.
Under Texas law, a partnership is "an association of two or
more persons to carry on as co-owners a business for profit."
Tex. Rev. Civ. Stat. Ann. art. 6132b, sec. 6(1) (West 1990).6 For
Federal tax purposes, generally, a partnership exists when
persons combine their money, goods, labor, or skill to carry on a
trade, profession, or business and there is a community of
interest in the profits or losses. See Commissioner v.
Culbertson, 337 U.S. 733, 742 (1949); see also sec. 7701(a)(2).
Under Texas law, a joint venture is in the nature of a
partnership, but it is usually limited to one particular
enterprise. See State v. Houston Lighting & Power Co., 609
S.W.2d 263, 267 (Tex. Civ. App. 1980).
a. The Babcock Road Property
Petitioners contend that they acquired the Babcock Road
property as cotenants. They contend the fact that they labeled
TGR I as a partnership does not control. See, e.g., Coastal
Plains Dev. Co. v. Micrea, Inc., 572 S.W.2d 285, 288 (Tex. 1978);
Valero Energy Corp. v. Teco Pipeline Co., 2 S.W.3d 576, 586 (Tex.
App. 1999); Ben Fitzgerald Realty Co. v. Muller, 846 S.W.2d 110,
121-122 (Tex. App. 1993). They point out that coownership of
6 Texas adopted the Texas Uniform Partnership Act (TUPA) in
1961, effective Jan. 1, 1962. See Humphrey v. Bullock, 666
S.W.2d 586, 588 (Tex. App. 1984).
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