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approach in this case, if petitioner sold the Citrus County
Property to a willing buyer for its fair market value of $87,000,
and then transferred the sale proceeds in partial satisfaction of
his personal liability as guarantor, he would have realized
$85,156 ($87,000 amount realized minus $1,844 basis). On the
facts presented, we hold that petitioner realized $85,156 on the
foreclosure sale to Freedom.
C. Miscellaneous Items of Schedule C Income
FINDINGS OF FACT
On February 6, 1985, petitioner deposited $37,500 into his
bank account with Freedom Savings & Loan Association. The record
contains a check of $37,500 from Orange Valley Real Estate
Exchange, Inc., to the order of Metro Realty Association. The
spreadsheets that petitioner used to complete his tax returns
list this amount under “Sales & Comm”. Petitioner reported this
amount as a part of his gross profit from his real estate
business on Schedule C of his 1985 return.
Petitioner received net commission income of $598 from
National Land Commissions in 1986.
On July 1, 1985, petitioner deposited checks from Crazy
Commandos of $250 for rent from June 15 to 30, 1985, and $500 for
rent from July 1 to 31, 1985. Petitioner also deposited $500 of
rent from Crazy Commandos into his Freedom account on September
59(...continued)
T.C. Memo. 1997-298; Rev. Rul. 90-16, 1990-1 C.B. at 13.
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