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particular expenditure was made, and some of the photocopied
receipts and handwritten lists were insufficient on their face.
With respect to taxable year 1990, we find that the events fixing
the loss inflicted by Tropical Storm Allison all occurred in
1989. The storm hit in the middle of 1989, and petitioners were
awarded their FEMA grant that same year.
An outright disbursement or grant made by a public agency
designated to help relieve any financial losses caused by a
natural disaster is in the nature of "insurance or otherwise."
Spak v. Commissioner, 76 T.C. 464, 467 (1981); Shanahan v.
Commissioner, 63 T.C. 21 (1974). Consistent with this rule, on
their 1989 Form 4684, Casualties and Thefts, petitioners reported
their FEMA grant on the line provided for "insurance or other
reimbursement". The record shows that petitioners failed to
substantiate any casualty losses in excess of the amount
compensated for by insurance or otherwise, and that the events
fixing the damages caused by Tropical Storm Allison all occurred
in 1989. Accordingly, we hold that petitioners are not entitled
to claim a casualty loss for either of the taxable years 1989 and
1990.
3. 1991 Schedule A Miscellaneous Deductions
On their 1991 Schedule A, Form 1040, petitioners claimed
miscellaneous deductions in the amount of $22,237. Petitioners
indicated on their return that this amount consisted of the
following: $126 paid to acquire stock, $575 for term insurance,
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