Good afternoon. As long as the entity has held this for 12 months, you should be able to report this as a long term capital gain. An entity can hold different kinds of assets and just because the entity also has rental properties, it does not preclude the entity from having investment property that can be sold and treated as long term capital gain.
I hope this has given you information that has been helpful to you. I wish you the best of luck!
If you have a follow-up question, please remember that there might be a delay between your follow up questions and my answers because I may be helping others or taking a break.
If I have adequately answered your question, even though the answer might not have been the one for which you hoped, I would appreciate it if you would please click the GREEN ACCEPT button so that I receive credit for my work; otherwise, though you have made a deposit, I do not receive credit.
If you need additional clarification on this question after clicking ACCEPT, please do not hesitate to click Reply and I will be happy to do what I can to help you further. Thanks for allowing me to be of service to you.
Please be aware that the information provided here is not legal advice. Rather it is simply general information. All states have intricacies in their laws and any information given is simply information only and specifically is not intended to be, nor does it constitute, legal advice. This communication does not establish an attorney-client relationship with you. I hope this answer has been helpful to you.
It's not unusual that they might take that position, but your argument is better. If the land has been held for 12 months or more, this is investment property held for investment.