27- -
B. Claimed Casualty Loss Carryover Deduction for 1990
On line 26 of Schedule A of their Federal income tax return
for the taxable year 1990, petitioners claimed a miscellaneous
deduction in the amount of $81,643. The explanation given for
the deduction was "casualty carry over from 1988 - 1989." This
deduction relates to the $142,729 claimed casualty loss for the
claimed storm damage in 1988, which petitioners originally
claimed on their Federal income tax return for the taxable year
1988. The claimed casualty loss is properly before the Court for
the taxable year 1991. Consequently, petitioners are not
entitled to the $81,643 claimed miscellaneous deduction for the
taxable year 1990.
C. Flood Damage to Home, Contents, Lawn, and Driveway in
1991
It is clear that the flooding of petitioners' property in
February and April 1991 was so severe as to constitute two
separate casualties within the meaning of section 165(c)(3).
1. February Flood
With respect to the February flood damage to petitioners'
home and its contents, an insurance adjuster for ABIC determined,
and ABIC paid to petitioners, insurance reimbursement of
$79,978.11, consisting of $26,698.61 for damage to the home (not
including their lawn and driveway) and $53,279.50 for damage to
its contents. On their 1991 Federal income tax return
petitioners claimed a loss of $156,778 for the damage caused by
the February flood. At trial, they reduced the amount of the
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