- 5 -
dated December 15, 1993. Petitioners believe that the December
15, 1993, date on these documents establishes that the
forgiveness of indebtedness income was realized in 1993, not
1994.
However, petitioners have declined to address, or have
misconstrued, the most salient fact; namely, that the escrow
instructions, dated December 9, 1993, were issued to the Title
Company on behalf of both AAL, the creditor, and the debtor
Partnership. The escrow instructions are worded in such a way
that the Title Company’s “acceptance” of the instructions would
be completed only when various exceptions to closing title had
been satisfied. These, in fact, were not completed until May 27,
1994, when title closed with the filing for recordation of the
aforementioned Grant Deed and the issuance of an owner’s title
policy, the exceptions having been satisfied. It was on this
date that 1994, and not 1993, was established as the year in
which the forgiveness of indebtedness income was realized.
Petitioners dispute the Court’s holding that the facts do
not bring this case within those of Keith v. Commissioner, 115
T.C. 605 (2000), which case specifically involved a type of
transaction under Georgia law known as a “contract for deed.” As
we pointed out in the Memorandum Opinion, Georgia law normally
construes a contract for deed as a device for passing equitable
ownership, leaving the seller with bare legal title and
Page: Previous 1 2 3 4 5 6 Next
Last modified: May 25, 2011