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Respondent contends that no legitimate business purpose
prompted the incorporation of Vision because, as members of a
limited liability company, the members of JCLC did not have a
need to protect themselves from unlimited liability as was the
case for the partners in Bramblett. Conversely, petitioner
contends that he, his brother, and Oldach possessed a legitimate
business reason to organize Vision. Although the members of JCLC
were not exposed to unlimited liability as were the partners in
Bramblett, by incorporating Vision to perform development work on
a relatively small parcel of land, they protected JCLC’s sole
asset, the remaining land, from obligations arising from Vision’s
development activity. For those reasons and because Vision was
organized for a legitimate business purpose and all corporate
formalities were followed, we conclude that Vision’s development
activity is not attributable to JCLC.
III. The Continuity and Frequency of Sales as Distinguished From
Isolated Transactions
In determining whether property was held for sale in the
ordinary course of business, the frequency and substantiality of
sales is the most important factor to be considered. See
Suburban Realty Co. v. United States, 615 F.2d 171, 176 (5th Cir.
1980); Medlin v. Commissioner, T.C. Memo. 2003-224; Hancock v.
Commissioner, T.C. Memo. 1999-336. Frequent and substantial
sales of real property more likely indicate sales in the ordinary
course of business, whereas infrequent sales for significant
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