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Expenditures paid or incurred for regular maintenance to
keep property used in a trade or business in an ordinarily
efficient operating condition are currently deductible. See
Plainfield-Union Water Co. v. Commissioner, 39 T.C. 333, 337
(1962); secs. 1.162-4, 1.263(a)-1(b), Income Tax Regs.; see also
Ingram Indus., Inc. v. Commissioner, T.C. Memo. 2000-323.
Conversely, expenditures that constitute replacements,
alterations, improvements, or additions that prolong the life of
the property, increase its value, or make it adaptable to a
different use generally constitute capital expenditures that are
not currently deductible. See sec. 263(a); sec. 1.263(a)-1(a)
and (b), Income Tax Regs.; see also Illinois Merchants Trust Co.
v. Commissioner, 4 B.T.A. 103, 106 (1926). In order to establish
they are entitled to deduct the repairs expense, petitioners must
show that the purpose of the expenditure was merely to keep the
rug in an ordinarily efficient operating condition and that those
repairs did not make the rug more valuable or more useful or
appreciably prolong its life. See Plainfield-Union Water Co. v.
Commissioner, supra; Illinois Merchants Trust Co. v.
Commissioner, supra; Ingram Indus., Inc. v. Commissioner, supra.
Petitioners contend that the repairs were necessary to
maintain the usefulness of the rug and that they did not
substantially prolong the rug’s useful life. Respondent contends
that petitioners used the rug in their personal residence and
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