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or exchange of capital assets subject to capital gain treatment
or whether they should be treated as ordinary income (other than
income subject to self-employment tax).
V. The Controlling Facts of This Case
We now apply the above discussion to the facts before us in
this case. Upon his retirement, petitioner returned all assets
used in the daily course of business, including a computer, books
and records, and customer lists to State Farm pursuant to the
agreement. Thus, much like the taxpayers in Foxe v.
Commissioner, supra, and Schelble v. Commissioner, 130 F.3d 1388
(10th Cir. 1997), petitioner did not own these assets and,
therefore, could not have sold them to State Farm.
Petitioner argues that the successor agent assumed his
telephone number and hired the two employees of the agency, and
that petitioner taught the successor agent about the agency and
introduced him to policyholders, all of which support the
argument that he sold the agency to State Farm.
The successor agent obtained the right to use the telephone
number utilized by petitioner’s agency. Petitioner did not
argue, and we do not conclude, that the telephone number was a
capital asset in the hands of petitioner. Additionally, there
are no facts in the record that indicate that petitioner received
any portion of the termination payment as payment for the
successor agent’s use of the telephone number.
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