- 16 -
of carrying the land. Determining whether the special rule in
the regulations is applicable requires a finding of the primary
purpose for acquiring or holding the land. Engdahl v.
Commissioner, 72 T.C. 659, 668 n.4 (1979); Perry v. Commissioner,
T.C. Memo. 1997-417; Hoyle v. Commissioner, T.C. Memo. 1994-592.
Based largely on Dr. Burrus’ own testimony and also on the
objective evidence, we are persuaded that petitioners held the
Maple Row land (i.e., the Cheatham, Robertson, and Sumner
Properties) during the years in issue primarily with the intent
to profit from the increase in the land’s value. Dr. Burrus
testified that “if I was going to make a profit related to this
[i.e., Maple Row], it was because of the land rather than the
herd, the cattle.” Further, Dr. Burrus testified specifically to
his interest in land as an investment:
I’m not really into asset-buying, other than buying
land. * * * I’m sort of like stocks like I am land.
If I buy them, I just let them sit, so I - I don’t sell
them unless there’s some reason.
With respect to the Maple Row land, Dr. Burrus testified that he
“was pretty sure it was going up in price” during the years in
issue, and appraisals obtained by petitioners support the view
that the properties were appreciating substantially. Moreover,
Mrs. Burrus reported her occupation for the years in issue as
“real estate manager”.
Page: Previous 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 NextLast modified: May 25, 2011