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date for commencement of a trade or business, within the meaning
of section 162, to be October 23, 1973, when closing on the
project took place and the formal regulatory agreement between
the partnership and HUD was executed. Id. at 877-881, 895. The
court noted that by this date “the partnership had acquired the
land, had arranged for financing of the project, had executed its
building loan agreement and given a note therefor, had received
substantial funds, and had prepared plans for actual construction
of its apartments (which began shortly thereafter).” Id. at 880.
The necessity for a comparable commitment to a particular
and focused project is highlighted by contrast with cases cited
by respondent. In McKelvey v. Commissioner, T.C. Memo. 2002-63,
for instance, the taxpayer conducted a prepurchase economic and
market feasibility study on a parcel of forestland, purchased the
land with the intent to start a tree-farming business, engaged a
third-party professional to prepare a forest management plan, and
conducted an unsuccessful test pilot planting. However, the
taxpayer by the end of the period in issue “had not decided which
species of trees to plant and had not harvested any of the
existing trees on his property”. Id. The Court held that any
expenditures were fairly characterized as startup expenses. Id.
Likewise, Reems v. Commissioner, T.C. Memo. 1994-253,
involved a venture to raise and harvest timber. During the year
in issue, taxpayer acquired the property and engaged a woodsman
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