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Florida or its political subdivisions. Hernandez v.
Commissioner, T.C. Memo. 1998-46, supplemented by T.C. Memo.
1998-329; Barrow v. Commissioner, T.C. Memo. 1983-123. The
Florida statutes under which the tax certificates at issue in
this case were issued and redeemed have undergone no material
change since they were analyzed for purposes of section 103 in
the foregoing opinions.5 Under the reasoning outlined in
Hernandez and Barrow, which we need not repeat here, we hold that
the interest income petitioners received upon the redemption of
the Florida tax certificates they held is not excluded from gross
income by section 103. Accordingly, we sustain respondent’s
determination that petitioners must include $28,136 of taxable
interest in their gross income for 1996.
Petitioners offered no evidence to refute respondent’s
determination that they received taxable interest income in the
5 Our analysis in Barrow v. Commissioner, T.C. Memo. 1983-
123, focused on the nature of the obligations that existed
between a tax certificate’s purchaser, the property’s owner, and
the tax collector under Florida law. Specifically, we looked at
secs. 197.116 and 197.156 of the Florida Statutes governing the
issuance and redemption of tax certificates, and sec. 197.241 of
the Florida Statutes governing a certificate holder’s right to
convert the certificate into a tax deed.
In the period between our opinions in Barrow and Hernandez
v. Commissioner, T.C. Memo. 1998-46, supplemented by T.C. Memo.
1998-329, secs. 197.116, 197.156, and 197.241 of the Florida
Statutes were repealed and replaced by secs. 197.432, 197.472,
and 197.502, respectively. The substance of these provisions,
however, has not changed in any material manner since they were
first analyzed in Barrow or revisited in Hernandez.
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