Juanita Carter - Page 19

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               exists with respect to a claim of reimbursement of a loss is           
               a question of fact to be determined upon an examination of             
               all facts and circumstances.  Whether or not such                      
               reimbursement will be received may be ascertained with                 
               reasonable certainty, for example, by a settlement of the              
               claim, by an adjudication of the claim, or by an abandonment           
               of the claim. * * * [Emphasis added.]                                  

          In 1993, petitioner filed suit against the airport seeking                  
          compensation for the loss of her property.  In 1995, her suit was           
          dismissed with prejudice.  Her efforts to obtain reimbursement              
          for her loss subsequent to 1989 are clear.  Petitioner obviously            
          felt that she had a reasonable prospect of collecting a judgment            
          or other compensation for her loss during or after 1989.  Not               
          until 1995, when her suit was dismissed with prejudice, did                 
          petitioner's loss become "sustained" within the meaning of                  
          section 165 because, only at that time, could it be "ascertained            
          with reasonable certainty" that petitioner would not receive                
          compensation for her loss.  It follows that petitioner did not              
          "sustain" (as defined in section 1.165-1(d)(2)(i), Income Tax               
          Regs.) a casualty loss in 1989, as required under section 165(a)            
          in order for such loss to be deductible in that year.  Respondent           
          is, therefore, sustained on this issue.                                     
               The fifth issue is whether petitioner is liable for the                
          addition to tax under section 6651(a)(1) for failure to file                
          timely a Federal income tax return for 1989, 1990, 1991, and 1992           
          and the penalty under section 6662(a) for negligence or                     
          intentional disregard of rules or regulations.                              




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