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without an assignment of the promissory note and that this
indicates the mortgage was assigned to Charles Medlin as
collateral for a loan.17 However, the assignment of the mortgage
states that the mortgage “Together with the note or obligation
described in said mortgage, and the moneys due and to become due
thereon” were transferred. We hold that petitioner recognized
gain of $30,925 from the sale of an installment obligation in
1985.
2. Susan’s Lakefront Estate (OS-03)
FINDINGS OF FACT
In 1970, Medlin Investment Co. purchased certain real
property in Osceola County, Florida, for $59,005. This property
was subdivided as “Susan’s Lakefront Estate” and consisted of 30
lots (Lot 1, Lot 2, * * *, Lot 30) and one tract (Tract A).
On July 2, 1985, petitioner through Ms. Allen, as trustee,
sold Lot 1 for $22,000. Petitioner did not report any income
from this sale on his 1985 Form 1040. On June 12, 1986,
petitioner through Ms. Allen, as trustee, sold Tract A, for
$23,000. Petitioner did not report any income from this sale on
his 1986 Form 1040. On May 25, 1988, petitioner through Mr.
17We note that a mortgage generally secures payment of the
underlying installment obligation and that an assignment of the
mortgage without an assignment of the note creates no right in
the assignee with respect to the note. See Vance v. Fields, 172
So. 2d 613, 614 (Fla. Dist. Ct. App. 1965).
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