Court Opinion

ID: 4478262
Source: CourtListenerOpinion
Date Created: 2020-01-16 21:12:58.494311+00
Date Added: 2024-06-11T15:03:31.116515
License: Public Domain

Murdock, /., dissenting: Section 112 (n) (1) refers to the sale of “property” “used by the taxpayer as his principal residence.” The property sold consisted of 13 acres improved by a house. All of that property was the “old residence” and. nobody contends to the contrary. The new residence was apparently purchased early in December and a part of the old residence was sold shortly thereafter and prior to December 31, 1950. Section' 112 (n) (1) did not apply to the sale of that part because it took place prior to December 31, 1950. However, the remaining part of the “old residence” “property” consisting of the remaining 10 acres was sold after December 31,1950, and section 112 (n) (1) can apply to the gain realized from the sale of that part of the old residence property. The opinion holds that section 112 (n) (1) does not apply to the sale of that part of the old residence property because the petitioner had previously sold the 3 acres on which the house was situated so that thereafter the petitioner was no longer using any part of the property as his principal residence. Section 112 (n) (1) does not require that the old residence be used as the taxpayer’s principal residence at the time actually sold and it does not require that the old residence property be sold in one piece. It appears in this case that Bogley had bought the new property and may have been occupying it before selling any part of the old residence property. Suppose that Bogley had purchased and moved into the new residence property on June 1,1951, and then on June 15 sold the house and 3 surrounding acres and on July 1 and 15, 1951, had sold the remaining 10 acres in 2 parcels. Section 112 (n) (1) should apply, despite the fact that the old residence was not being used as his principal residence at the time of any of the sales of portions of it, since section 112 (n) (1) contemplates that a new residence may be acquired and occupied as long as 12 months prior to the sale of the old residence property. The 10 acres were a part of the property constituting the old residence. That part of that property was sold after December 31, 1950, and the new property was purchased within 1 year prior to those sales. I cannot see why section 112 (n) (1) does not apply to the profit on the sale of the 10 acres, the amount of which is not in dispute. Oppbr, Pierce, FORRESTER, and TraiN, JJ., agree with this dissent.