David C. Hutchinson, et al. - Page 20

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          in 1994 through July 18, 1996, VRI did not have an interest in              
          the Clubhouse properly recoverable through depreciation, and we             
          reject respondent’s contention that because VRI allegedly had an            
          ownership interest in the Clubhouse during construction, VRI is             
          not qualified to allocate estimated Clubhouse construction costs            
          under the alternative cost method.                                          
               The question of whether VRI would have been able to recover            
          its Clubhouse construction costs through depreciation because it            
          allegedly had a depreciable interest in the Clubhouse during the            
          transition period (namely, on or after the Clubhouse was placed             
          in service on July 19, 1996, and until April 21, 1999, the date             
          the deed to the Clubhouse was transferred out of escrow to VCI),            
          turns on an analysis of the benefits and burdens relating to                
          ownership of the Clubhouse during the transition period.  See               
          Grodt & McKay Realty, Inc. v. Commissioner, 77 T.C. 1221, 1235-             
          1238 (1981).  Who possesses the benefits and burdens of ownership           
          of property constitutes a question of fact which is generally               
          ascertained from the intentions of the parties as evidenced by              
          the written agreements read in light of all the relevant facts              
          and circumstances.  See Durkin v. Commissioner, 87 T.C. 1329,               
          1367 (1986), affd. 872 F.2d 1271 (7th Cir. 1989).                           
               Some of the factors used by courts in analyzing whether                
          taxpayers possess the benefits and burdens of ownership of                  
          property are:  (1) Who has legal title to the property; (2) whom            

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