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otherwise. Section 1231(a) governs the characterization of gains
and losses from sales, exchanges, and involuntary conversions of
real and depreciable property used in a trade or business and
permits a taxpayer, in certain circumstances, to characterize
recognized losses incurred from such transactions or occurrences
as an ordinary loss rather than a capital loss subject to the
limitations on deductibility under section 165(f).
For purposes of section 165(a), a loss must be evidenced by
a closed and completed transaction and fixed by an identifiable
event. Sec. 1.165-1(b), Income Tax Regs. The mere diminution in
value of property is not sufficient to establish a loss for
purposes of section 165(a). United States v. White Dental
Manufacturing Co., 274 U.S. 398 (1927). To deduct a decrease in
value of property, there must be some event that fixes the fact
of the loss and the amount thereof. Petitioner contends that an
involuntary conversion of property is an identifiable event that
gives rise to a section 165 loss deduction. Petitioner contends
that an involuntary conversion of property occurs when a
"taxpayer's property, through some outside force or agency beyond
his control, is no longer useful or available to him for his
[purposes]" quoting C.G. Willis, Inc. v. Commissioner, 41 T.C.
468, 476 (1964), affd. 342 F.2d 996 (3d Cir. 1965), which
involved nonrecognition of gain upon an involuntary conversion
under section 1033. Petitioner also quotes a similar definition
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