40- -
6. Claimed Casualty Loss Deduction for Broken Kitchen Water
Pipes
Petitioners contend that damage to their home resulting from
broken kitchen water pipes is either part of the casualty loss
arising from the floods in 1991 or a separate casualty loss
deduction for 1991. Respondent contends that the broken kitchen
water pipes do not constitute a casualty within the meaning of
section 165(c)(3).
A "casualty" is an event due to some sudden, unexpected, or
unusual cause, such as a fire, storm, or shipwreck. Durden v.
Commissioner, 3 T.C. 1, 3 (1944). The progressive deterioration
of property through a steadily operating cause is not a casualty.
Fay v. Commissioner, 120 F.2d 253 (2d Cir. 1941), affg. 42 B.T.A.
206 (1940).
Petitioners offered no evidence which establishes that their
kitchen water pipes broke as a result of the 1991 floods. Their
flood insurance provider refused to cover the damage resulting
from the broken water pipes because they were located below the
flood water line, which indicates that the floods did not cause
the pipes to break. Therefore, we hold that the broken kitchen
water pipes were not part of the casualty loss caused by the 1991
floods. In the absence of proof that the water pipes broke as a
result of the floods, the logical conclusion is that they broke
as a result of progressive deterioration. Consequently, no
casualty loss may be deducted by petitioners for 1991 as a result
of the broken water pipes.
Page: Previous 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 NextLast modified: May 25, 2011