- 26 -
render the Los Angeles agency office a "qualified financial
institution". Thus, we hold that the three entities involved
herein were not similar institutions.
In sum, we hold that neither BCCI, S.A., its IOMB, nor its Los
Angeles agency office is a "qualified financial institution"
pursuant to section 165(l)(3)(D).14 Accordingly, petitioner is not
entitled to a casualty loss in 1991.
Issue 2. Bad Debt
Because petitioner is not entitled to a casualty loss, we must
determine whether she is entitled to a bad debt deduction under
section 166. Petitioner argues that her claimed loss should at
least be treated as a 1991 nonbusiness bad debt. Respondent agrees
that the claimed loss is properly treated as a nonbusiness bad
debt, but contends that the loss was not worthless at the close of
1991.
A nonbusiness debt is a debt other than "a debt created or
acquired * * * in connection with a trade or business of the
taxpayer" or "a debt the loss from the worthlessness of which is
incurred in the taxpayer's trade or business." Sec. 166(d)(2)(A)
14 The above analysis makes it unnecessary to consider
whether petitioner incurred a loss "as of the close of the
taxable year" that "can reasonably be estimated", sec.
165(l)(1)(A), and whether such loss was "on account of the
bankruptcy or insolvency of such institution", sec. 165(l)(1)(B).
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