WILLIAM FRIEDMAN ET AL. v. Commissioner, Docket No. 3858-73
| Decision Date | 28 June 1977 |
| Docket Number | 3859-73,3875-73,3860-73,3865-73,3862-73,3870-73,3874-73,3863-73,3876-73,3867-73,3861-73,3868-73,3864-73,3866-73,3869-73,3873-73,3467-74,3871-73,3872-73,Docket No. 3858-73,5856-74. |
| Citation | 1977 TC Memo 201,36 TCM (CCH) 841 |
| Parties | William Friedman, et al. v. Commissioner. |
| Court | U.S. Tax Court |
Melvin N. Greenberg, Forte Plaza, 1401 Brickell Ave., Miami, Fla., Eileen Trautman, Alan R. Chase, for the petitioners. Curtis Liles, III, for the respondent.
Memorandum Findings of Fact and Opinion
Respondent determined deficiencies in the income tax of petitioners in these consolidated cases as follows:
In addition, respondent amended his answer in the cases of Theodore Sondov and Dina Sondov, docket No. 3467-74; and Herman Sondov and Rhea Sondov, docket No. 3871-73 to include deficiencies in the taxable year 1970 in the amounts of $25,888.19 and $22,561.25, respectively.
Subsequently, respondent amended his answer to include additional deficiencies for the taxable year 1969, as follows:
Increase in
Docket No. Deficiency
3858-73 ............... $ 11,898.79
3859-73 ............... 78,127.70
3860-73 ............... 12,820.90
3863-73 ............... 4,927.78
3864-73 ............... 33,527.76
3865-73 ............... 534,164.70
3866-73 ............... 11,301.33
3867-73 ............... 92,235.30
3869-73 ............... 10,422.80
3870-73 ............... 11,212.31
3871-73 ............... 26,649,96
3873-73 ............... 2,665.95
3874-73 ............... 164,086.70
3876-73 ............... 6,200.70
_____________
Total .............. $1,000,242.68
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As a result of the agreement by the parties, the remaining issues to be considered at this time are as follows:
A. Buckley Towers
1. Whether the present value of the excess rents for the recreational facilities, which a purchaser of a condominium unit assumed as a condition of sale, is includable in the income of Buckley Development Co., Ltd., as a part of the consideration received for the sale of the condominium unit under section 61.2
2. In the alternative, whether the present value of the excess rents for the recreational facilities, which a purchaser of a condominium unit was required to assume as a condition of sale, should be allocated to Buckley Development Co., Ltd., as the developer of the property, under section 482.
3. In the event that respondent's determination is sustained, whether any additional income attributable to the sale of the residential condominium units may be reported on the installment basis pursuant to section 453.
B. Burleigh House
Whether the petitioners realized additional income in 1969 through a bargain purchase of the recreation and shop facilities of the Burleigh House condominium development.
Depending upon the decision of the Court with respect to these issues, a further hearing may be necessary to determine the nature and amount of such income and the extent to which such income is taxable to petitioners.
For the most part, the facts have been stipulated by the parties. The stipulation of facts, together with the exhibits attached thereto, are incorporated by this reference.
Petitioner William Friedman (docket No. 3858-73) resided in Miami Beach, Florida, on May 18, 1973, and July 12, 1974, at the times the petitions were filed. For the taxable years 1969 and 1970, the petitioner filed an income tax return with either the District Director of Internal Revenue at Jacksonville, Florida, or the Southeast Service Center of the Internal Revenue at Chamblee, Georgia.
Petitioners James F. Gallagher and Helene Gallagher (docket No. 3859-73) resided in Miami, Florida, and Miami Shores, Florida, at the time the petitions were filed. For the taxable years 1969 and 1970, the petitioners filed joint income tax returns with either the District Director of Internal Revenue at Jacksonville, Florida, or the Southeast Service Center of Internal Revenue at Chamblee, Georgia.
Petitioners Elliott Harris and Arlene F. Harris (docket No. 3860-73) resided at Miami Beach, Florida, at the times the petitions were filed. For the taxable years 1969 and 1970, the petitioners filed joint income tax returns with either the District Director of Internal Revenue at Jacksonville, Florida, or the Southeast Service Center of the Internal Revenue at Chamblee, Georgia.
Petitioner Keith Charles Pasternak, a Minor by Alan S. Pasternak, Custodian and Guardian, (docket No. 3861-73) resided at Miami, Florida, at the time the petition was filed. For the taxable year 1969, the petitioner filed an income tax return with either the District Director of Internal Revenue at Jacksonville, Florida, or the Southeast Service Center of the Internal Revenue at Chamblee, Georgia.
Petitioner Susan Jeanne Pasternak, a Minor by Alan S. Pasternak, Custodian and Guardian, (docket No. 3862-73) resided at Miami, Florida, at the time the petition was filed. For the taxable year 1969, the petitioner filed an income tax return with either the District Director of Internal Revenue at Jacksonville, Florida, or the Southeast Service Center of the Internal Revenue at Chamblee, Georgia.
Petitioners Donald L. Pearce and Bernice B. Pearce (docket No. 3863-73) resided at Miami, Florida, at the times the petitions were filed. For the taxable years 1969 and 1970, the petitioners filed joint income tax returns with either the District Director of Internal Revenue at Jacksonville, Florida, or the Southeast Service Center of the Internal Revenue at Chamblee, Georgia.
Petitioners Theodore Sondov and Dina Sondov (docket No. 3864-73 and 3467-74) resided in Fort Lauderdale, Florida, at the times the petitions were filed. For the taxable years 1969 and 1970, the petitioners filed a joint income tax return with either the District Director of Internal Revenue at Brooklyn, New York, or the North Atlantic Service Center of the Internal Revenue at Holtsville, New York.
Petitioners Herbert Buchwald and Arlene Buchwald (docket No. 3865-73) resided in Miami Beach, Florida, at the times the petitions were filed. For the taxable years 1969 and 1970, the petitioners filed joint income tax returns with either the District Director of Internal Revenue at Jacksonville, Florida, or the Southeast Service Center of the Internal Revenue at Chamblee, Georgia.
Petitioners Adalburt Buchwald and Helen Buchwald (docket No. 3866-73) resided in North Miami Beach, Florida, at the times the petitions were filed. For the taxable years 1969 and 1970, the petitioners filed joint income tax returns with either the District Director of Internal Revenue at Jacksonville, Florida or the Southeast Service Center of the Internal Revenue at Chamblee, Georgia.
Petitioner Stuart L. Haas (docket No. 3867-73) resided in Miami Shores, Florida, at the times the petitions were filed. For the taxable years 1969 and 1970, the petitioner filed income tax returns with either the District Director of Internal Revenue at Jacksonville, Florida, or the Southeast Service Center of the Internal Revenue at Chamblee, Georgia.
Petitioner Buchwald Enterprises, Inc. (docket No. 3868-73) is a Florida corporation with its principal place of business in Miami Beach, Florida, at the time the petition was filed. For the taxable year 1970, the petitioner filed an income tax return with either the District Director of Internal Revenue at Jacksonville, Florida, or the Southeast Service Center of the Internal Revenue at Chamblee, Georgia.
Petitioners Joshua Sirkin and Carolyn Sirkin (docket No. 3869-73) resided in Miami, Florida, at the times the petitions were filed. For the taxable years 1969 and 1970, the petitioners filed joint income tax returns with either the District Director of Internal Revenue at Jacksonville, Florida, or the Southeast Service Center of the Internal Revenue at Chamblee, Georgia.
Petitioners Norman Jacobson and Mildred Jacobson (docket No. 3870-73) resided in Saint Petersburg, Florida, at the times the petitions were filed. For the taxable years 1969 and 1970, the petitioners filed joint income tax returns with either the District Director of Internal Revenue at Jacksonville, Florida, or the Southeast Service Center of the Internal Revenue at Chamblee, Georgia.
Petitioners Herman Sondov and Rhea Sondov (docket No. 3871-73) resided in Fort Lauderdale, Florida, at the time the petition...
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