Helen Sophie Schroeder - Page 5

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          the outside of the barn with a red oil-based paint.  The                           
          structure of the barn was not altered.  The work done to the barn                  
          increased its hay storage capacity2 and enhanced the appearance                    
          of the property.  The granary roof also was fixed and the sides                    
          were treated and repainted in the same manner as the Rhodes barn.                  
          Petitioner spent $28,100 in 1991 to make repairs to, make                          
          improvements on, and demolish and remove buildings on the Rhodes                   
          property.  She deducted the following expenses as repairs on her                   
          1991 tax return:                                                                   
          Repair of Rhodes barn roof                             $6,800                      
          Preparation and painting of sides of Rhodes barn      7,200                        
          Repair and removal of debris from interior of                                      
          Rhodes barn                                            1,500                       
          Repair of Rhodes granary roof                          2,700                       
          Preparation and painting of sides of Rhodes                                        
          granary                                                     3,600                  
          Total                                                  21,800                      
          The $6,300 cost of demolishing a house and a storage building and                  
          removing the debris was not deducted by petitioner.  Petitioner                    
          also deducted $250 in 1991 for the replacement of a water heater                   
          in a small house on the Rhodes property.  At trial, petitioner                     
          conceded that the $1,500 cost of replacing two of the three                        
          structural support rods was a capital improvement.                                 
          The Whitefeather Property                                                          
                Petitioner purchased the Whitefeather property from her                      
          parents in 1993 for $25,000.  The property consists of 40 acres                    


                2  Repairing the leaking roof allowed more hay to be stored.                 




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