David Taylor Enterprises, Inc. & Subsidiaries - Page 24

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          C.  Conclusion                                                              
               The ultimate inquiry in this case is whether the classic               
          cars were held primarily for sale.  We find that they were.  We             
          find compelling the dealership’s continuous and consistent                  
          treatment of the classic cars as held for sale.  We also find               
          testimony concerning the dealership’s sales efforts credible and            
          persuasive.  From the date the dealership first acquired a                  
          classic car, the dealership has been in the business of selling             
          cars.  The dealership’s classic cars were consistently treated              
          for book purposes and tax purposes as held for sale.  We surmise            
          respondent now objects because of the ordinary losses generated             
          by the sales in the years at issue.  Respondent was apparently              
          content to collect tax at ordinary income rates on gains from               
          sales of the dealership’s classic cars in prior years.                      
               We have found that all of the pertinent factors favor                  
          petitioner or were neutral.  The factors, however, are not                  
          dispositive, and each case must rest upon its own facts.  The               
          focus here is upon the statute, which excludes from capital asset           
          treatment property held by the taxpayer primarily for sale to               
          customers in the ordinary course of his or her trade or business.           
          Sec. 1221(a)(1); see Thompson v. Commissioner, 322 F.2d 122, 127            
          (1963) (cited by United States v. Winthrop, 417 F.2d 905, 910               
          (5th Cir. 1969)), affg. in part and revg. in part 38 T.C. 153               
          (1962); Wood v. Commissioner, T.C. Memo. 2004-200.                          

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