The taxpayers, a married couple, sold 2.63 acres of undeveloped land that generated over $60,000. The taxpayers reported the income as capital gain subject to tax at favorable capital gain rates. IRS claimed that the income was "other income" that should be taxed as ordinary income. The taxpayers admitted that they bought the land for the purpose of developing the property and did attempt to find a partner to develop the property. Ultimately, the property was sold to a developer and the taxpayers received a payment each time a developed portion of the property was sold. The IRS denied capital gain treatment because they asserted that the income was from property "held by the taxpayer primarily for sale to customers in the ordinary course of his trade or business." The court noted that the determination of the nature of the income is a fact-based determination, and that the facts supported the IRS position. The taxpayers intended to develop and sell the property at the time it was acquired and that the taxpayers were active in getting the property developed. The fact that the property was the only one purchased for development was not determinative. The court granted summary judgment to the IRS. Allen v. United States, No. 13-cv-02501-WHO, 2014 U.S. Dist. LEXIS 73367 (N.D. Cal. May 28, 2014).