On June 24, 1997, about 0915 Alaska daylight time, an amphibian float equipped Cessna 185 airplane, N4952E, received minor damage while landing on Figure Eight Lake, located about 15 miles northwest of Anchorage, Alaska. The airline transport certificated pilot-in-command (PIC), and the airline transport certificated Federal Aviation Administration inspector aboard the airplane were not injured. The local, 14 CFR Part 91 flight operated in visual meteorological conditions without a flight plan. The flight departed the Anchorage International Airport about 0845. The purpose of the flight was for the PIC to receive a Certificated Flight Instructor (CFI) renewal flight check from the FAA inspector. The NTSB investigator-in-charge spoke with the FAA inspector via telephone on June 24, and the pilot on June 25. Both the PIC and the FAA inspector related essentially the same information. The flight departed with the amphibian float wheels extended from Runway 24, intersection Charlie. The PIC accepted a clearance to turn to the right (north) prior to reaching Runway 14/32. The PIC said this clearance was acceptable, but instead of immediately retracting his wheels once he was airborne, he elected to keep the wheels extended longer than normal because the route of flight would place the airplane over a hard surface for a longer than normal period of time. The PIC said he was also concerned and distracted with radio transmissions and other airplane traffic as he departed Anchorage and neared Figure Eight Lake. The PIC said he forgot to retract the landing gear, and believes the distractions associated with the departure from Anchorage interrupted his normal routine of retracting the wheels. At the FAA inspector's request, he made an approach to land on Figure Eight Lake, and began to demonstrate and verbalize to the FAA inspector the technique for a glassy water landing. Upon touchdown, the airplane slowed, tipped forward, and went upside down. The FAA inspector related that he was also distracted looking for airplane traffic, and failed to notice that the PIC had not retracted the wheels. Both occupants were able to exit the airplane, and sat on the floats for a short time until another airplane landed on the lake and picked them up. The airplane is equipped with landing gear position indicator lamps which reflect whether the wheels are retracted or extended. The PIC indicated these lamps were operating properly throughout the flight and landing. The airplane was recovered and examined by an NTSB investigator. No preimpact mechanical anomalies were discovered, and the degree of damage was reclassified as minor.