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sales were in the ordinary course of its business. More
importantly, JCLC held the property for 4 years during which time
the value appreciated. JCLC began selling the property at a time
when it was believed that the investment and appreciation goals
had been achieved.
IV. Other Facts
During October 1996 a Preliminary Geotechnical Investigation
was done on behalf of JCLC for a cost of $2,200. The purpose of
the report was to evaluate soil conditions for the development of
the property. In addition the amended and final development
plans for the parcels sold to Elite and Vision were approved by
the town of Monument prior to the 1998 completion of the sales
transactions. Respondent argues that these facts are indicative
of development activity with respect to JCLC.
In Thrift v. Commissioner, 15 T.C. 366 (1950), the taxpayer
improved and developed property for the purpose of facilitating
the disposition of the property to a limited group of builders to
whom the taxpayer had already reached agreement. In that case,
we held that the taxpayer’s course of conduct did not establish
any ordinary “course of business as to the sale of lots such as
is required to convert the property from the character of a
capital asset held for investment purposes to property held for
sale in the ordinary course of * * * business.” Id. at 371. We
reach the same conclusion here. The soil test and obtaining
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