Question: Walter is both a real estate developer and the owner and manager of residential rental real estate. Walter is retiring and is going to sell

Walter is both a real estate developer and the owner and manager of residential rental real estate. Walter is retiring and is going to sell both the land he is holding for future development and the rental properties he owns. Straight-line depreciation was used to depreciate the rental real estate. The rental properties will be sold at a substantial loss, and the development property will be sold at a substantial gain. What is the nature of these gains and losses?
Partial list of research aids:
§§ 1221 and 1231.
Zane R. Tollis, 65 TCM 1951, T.C.Memo. 1993-63.

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