Andrew E. Blanche, Jr., and Cynthia D. Blanche - Page 22




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          duty to maintain the property; (3) were responsible for insuring            
          the property; (4) bore the risk of loss of the property; (5) were           
          obligated to pay taxes, assessments, and charges against the                
          property; (6) had the right to improve the property without the             
          seller’s consent; and (7) had the right to obtain legal title at            
          any time by paying the balance of the purchase price.  See Derr             
          v. Commissioner, 77 T.C. 708, 724-725 (1981); Ryan v.                       
          Commissioner, T.C. Memo. 1995-579.  Petitioners had the right to            
          possess the property but were prohibited from renting out or                
          subleasing the property.  Petitioners had a duty, as lessees, to            
          maintain the property in a reasonable condition and to repair               
          certain damage caused by them; however, petitioners were not                
          required to insure the property or bear the risk of loss.                   
          Petitioners were not obligated to pay taxes, assessments, or                
          charges against the property, nor did they have the right to                
          improve the property without written consent.  Analyzing these              
          factors, petitioners did not possess the benefits and burdens of            
          ownership prior to August 1992.  See also Koehler v.                        
          Commissioner, T.C. Memo. 1978-381.                                          
               On this record, the Court finds that petitioners were mere             
          lessees of the Foxbriar property and did not have the benefits              
          and burdens of ownership so as to make them equitable owners of             
          the property until August 1992, the time at which they assumed              
          liability to Lomas Mortgage.  Thus, on this record, the Court               








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