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such testimony to support petitioners’ position in the instant
cases.
Petitioners did not call Ms. Havens to testify in support of
their position in these cases. We presume that Ms. Havens did
not testify because her testimony would not have been favorable
to petitioners’ position. See Wichita Terminal Elevator Co. v.
Commissioner, 6 T.C. 1158, 1165 (1946), affd. 162 F.2d 513 (10th
Cir. 1947).
1994 Caroline County Farm Expenses, 1994 Virginia Beach
Property Expenses, and 1995 Virginia Beach Property Expenses
In support of their position with respect to the disputed
property expenses, petitioners argue:
Because the Caroline County Farm was investment prop-
erty held for rent and for resale, DC [Delaware Corpo-
ration] may deduct real estate taxes, mortgage interest
and utilities and operating expenses paid by it. * * *
* * * DC can deduct mortgage interest paid on the
Virginia Beach property in 1994 and 1995 and mortgage
interest paid on the Caroline County farm in 1995,
because the Virginia Beach property was rental prop-
erty. Both pieces were investment property held for
rent and resale. * * *
* * * * * * *
Assets sold to DC were Caroline County farm,
$715,000; Virginia Beach property $300,000; Marion-
Booker spec house [Chick Cove property], $99,000;
Mitchum’s [sic] Creek property $75,000 and 60% interest
in MSA-Kuwait, total in excess of $1,000,000. This
infusion of capital enabled DC to get back into the
construction business and make a profit.
* * * All these transactions had substantial
economic, commercial and legal effects other then
expected tax benefits. They were in no way an economic
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