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$103,203.221 was paid directly by North Fork Timber Company to
Ms. Olsen in satisfaction of petitioner’s obligation under the
agreement. Petitioner received a note receivable (note) for the
balance of the purchase price, or $65,000, from North Fork Timber
Company. The terms of the note stated an 8-percent interest rate
and payments of $1,586.84 per month, payable over 48 months
beginning on March 17, 1994, and ending on February 8, 1998.
At the time the Tryon Road property was sold to North Fork
Timber Company on February 17, 1994, Ms. Olsen did not have any
outstanding liabilities payable to, or other obligations owed, to
North Fork Timber Company, Title Guaranty Company of Lewis
County, or petitioner, nor did the sale of the Tryon Road
property to North Fork Timber Company relieve Ms. Olsen from any
obligations owed to North Fork Timber Company, Title Guaranty
Company of Lewis County, or petitioner.
During the taxable year 1994 petitioner received $3,981.05
in interest income. Petitioner also received a 1994 Form 1099-S,
Proceeds From Real Estate Transactions, from Title Guaranty
Company of Lewis County which reported real estate sales proceeds
in 1994 of $175,000 from the sale of the Tryon Road property.
Petitioner contends that he did not realize a taxable gain on the
sale of the Tryon Road property, and, based upon this belief, did
1 This amount represents the $103,000 obligation plus
interest.
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