- 27 -
T.C. 708, 724 (1981), that must be made as of the date of the
purported sale, see id. at 723-724.26 In Grodt & McKay Realty,
Inc. v. Commissioner, 77 T.C. 1221, 1237-1238 (1981), we held:
The key to deciding whether petitioners’ transactions
* * * are sales is to determine whether the benefits
and burdens of ownership have passed * * *. This is a
question of fact which must be ascertained from the
intention of the parties as evidenced by the written
agreements read in light of the attending facts and
circumstances. Some of the factors which have been
considered by courts in making this determination are:
(1) Whether legal title passes; (2) how the parties
treat the transaction; (3) whether an equity was ac-
quired in the property; (4) whether the contract cre-
ates a present obligation on the seller to execute and
deliver a deed and a present obligation on the pur-
chaser to make payments; (5) whether the right of pos-
session is vested in the purchaser; (6) which party
pays the property taxes; (7) which party bears the risk
of loss or damage to the property; and (8) which party
receives the profits from the operation and sale of the
property. * * * [Fn. refs. and citations omitted.]
The Court applies the so-called strong proof rule where a
taxpayer asserts, as petitioners do here, that a transaction that
is in form a sale of property is not a sale for tax purposes.
See Ill. Power Co. v. Commissioner, 87 T.C. 1417, 1434 (1986);
Coleman v. Commissioner, 87 T.C. 178, 204 (1986), affd. without
published opinion 833 F.2d 303 (3d Cir. 1987). Under the strong
proof rule, a taxpayer must present strong proof, i.e., more than
a preponderance of the evidence, for the Court to disregard the
form in which the taxpayer cast a transaction. See Ill. Power
26See also Siegel v. Commissioner, T.C. Memo. 1985-441;
Hunter v. Commissioner, T.C. Memo. 1982-126.
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