-23-
We have observed that “‘the taxpayer may have less freedom
than the Commissioner to ignore the transactional form that he
has adopted.’” Ill. Power Co. v. Commissioner, 87 T.C. 1417,
1430 (1986) (quoting Bolger v. Commissioner, 59 T.C. 760, 767 n.4
(1973)). In applying the substance over form doctrine, we are
concerned with the intentions of the parties at the time of the
transaction. Groetzinger v. Commissioner, 87 T.C. 533, 542
(1986).
To prevail, the taxpayer must provide objective evidence
that the substance of the transaction is in accord with the
position argued by the taxpayer rather than the form set forth by
the relevant documents. Id. at 541. Furthermore, for substance,
as opposed to form, to control the tax consequences of a
transaction, the taxpayer must establish the claimed substance of
the transaction under a heightened burden of proof. Norwest
Corp. v Commissioner, 111 T.C. 105, 140, 145 (1998); Ill. Power
Co. v. Commissioner, supra at 1434. The strong proof standard
requires the taxpayer to present more than a preponderance of the
evidence in support of his characterization of the transaction.
Ill. Power Co. v. Commissioner, supra at 1434 n.15.
Petitioners argue that although the South Point Road lot was
purchased by the Family Partnership, the partnership was never
fully implemented, and therefore, it should be disregarded.
However, petitioners stipulated that the Family Partnership was
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