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In determining whether there is gain or loss on the
foreclosure of petitioner’s property in 1991, an allocation must
be made for tax purposes between the portion of the structure’s
use devoted to personal use and the portion devoted to
petitioner’s business. See Snyder v. Commissioner, T.C. Memo.
1975-221.
According to petitioner, the entire structure should be
treated as property used in a trade or business despite the fact
that he lived there. In support of his argument, petitioner
cites four Tax Court cases.22 In each cited case, the taxpayer
was seeking an exclusion from gross income under section 61 for
either lodging or meals provided by his employer pursuant to
section 119.
Under section 119(a)(2), the value of lodging furnished to
an employee is excluded from the employee’s gross income if “the
employee is required to accept such lodging on the business
premises of his employer as a condition of his employment.”
Here, however, the fair rental value of the lodging provided to
petitioner has not been included in his income by respondent.
Rather, respondent determined that petitioner realized a capital
gain when the Miami property was foreclosed. Thus, section 119
as an exception to section 61 does not apply in the instant case.
22Giesinger v. Commissioner, 66 T.C. 6 (1976); Lindeman v.
Commissioner, 60 T.C. 609 (1973); Olkjer v. Commissioner, 32 T.C.
464 (1959); and Stone v. Commissioner, 32 T.C. 1021 (1959).
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