Ocmulgee Fields, Inc. v. Comm'r
United States Tax Court
P transferred appreciated real property to a qualified intermediary, which sold the property and used the proceeds to purchase from a person related to P like-kind property, which it transferred to P. Held: P has failed to prove the absence of a principal purpose of Federal income tax avoidance; P's exchange with the qualified intermediary is part of a transaction structured to avoid the purposes of sec. 1031(f), I.R.C., governing like-kind exchanges between related persons,…
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P transferred appreciated real property to a qualified intermediary, which sold the property and used the proceeds to purchase from a person related to P like-kind property, which it transferred to P. Held: P has failed to prove the absence of a principal purpose of Federal income tax avoidance; P's exchange with the qualified intermediary is part of a transaction structured to avoid the purposes of sec. 1031(f), I.R.C., governing like-kind exchanges between related persons, and, under sec. 1031(f)(4), I.R.C., the nonrecognition provisions of sec. 1031, I.R.C., do not apply to the exchange.
1Opinion of the Court
Halpern, Judge:
By notice of deficiency (the notice), respondent determined a deficiency of $2,015,862 in petitioner’s Federal income tax for its taxable year ended May 31, 2004 (taxable year 2004), and an accuracy-related penalty of $403,172.
Unless otherwise indicated, all section references are to the Internal Revenue Code of 1986, as amended and in effect for taxable year 2004, and all Rule references are to the Tax Court Rules of Practice and Procedure.
The deficiency determination is the result of respondent’s adjustment requiring that petitioner recognize the gain it realized on the…
2Cases cited9 opinions
- Shea v. CommissionerUnited States Tax Court · 1999
- Mendes v. Comm'rUnited States Tax Court · 2003
- Philadelphia Park Amusement Co. v. United StatesUnited States Court of Claims · 1954
- Dudley B. Merkel Ladonna K. Merkel David A. Hepburn, and Nancy J. Hepburn v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1999
- Hofstetter v. CommissionerUnited States Tax Court · 1992
4 more not listed; retrieve them via the Exa API.
3Cited by10 opinions
- Ocmulgee Fields, Inc. v. Comm. of Internal RevenueCourt of Appeals for the Eleventh Circuit · 2010
- Cadwell v. CommissionerUnited States Tax Court · 2011
- Adeyemo v. Comm'rUnited States Tax Court · 2014
- Barnes v. Comm'rUnited States Tax Court · 2012
- Yates v. Comm'rUnited States Tax Court · 2013
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