Lakin v. Commissioner
United States Tax Court
During a number of years petitioners purchased, as tenants in common, a number of lots in existing developments and 2 tracts of land which they subsequently subdivided. Petitioners were the principal shareholders and officers of the Hagerstown Lumber Company, a building material supply company, and of Model Homes, Incorporated, a speculative building company which was used as an outlet for the lumber company's products.
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During a number of years petitioners purchased, as tenants in common, a number of lots in existing developments and 2 tracts of land which they subsequently subdivided. Petitioners were the principal shareholders and officers of the Hagerstown Lumber Company, a building material supply company, and of Model Homes, Incorporated, a speculative building company which was used as an outlet for the lumber company's products. Model Homes purchased the majority of its lots from the petitioners. During the years in question petitioners sold about 55 lots, including 21 lots of Model Homes. Sales to…
1Opinion of the Court
OPINION.
Black, Judge,:
The petitioners during the years 1949, 1950, and 1951 sold approximately 55 lots, which they held for over 6 months as tenants in common. They reported their gain on these sales as long-term capital gain. The respondent determined that the gain, the amount of which is not in dispute, was ordinary income.
Whether the gain was ordinary income or capital gain depends upon whether the lots which were sold were held primarily for sale to customers in the ordinary course of trade or business. Sec. 117 (a).
This is a factual determination, Arthur E. Wood, 25 T. C. 468, 473…
2Cases cited5 opinions
- Mauldin v. CommissionerUnited States Tax Court · 1951
- Kaltreider v. CommissionerUnited States Tax Court · 1957
- Curtis Company (Formerly Curtis Engineering Company) v. Commissioner of Internal RevenueCourt of Appeals for the Third Circuit · 1956
- Wood v. CommissionerUnited States Tax Court · 1955
- Reithmeyer v. CommissionerUnited States Tax Court · 1956
3Cited by1 opinion
- Lakin v. CommissionerUnited States Tax Court · 1957