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pension plans or annuities,3 the issue decided in Hellermann v.
Commissioner, 77 T.C. 1361 (1981), involved the same principles.
In Hellermann v. Commissioner, supra, the taxpayers argued that
gain that was realized from the sale of property should be
adjusted to take into account the inflation that occurred during
the ownership of the property. We disagreed.
First, we relied upon “the well-established doctrine that
Congress has the power and authority to establish the dollar as a
unit of legal value with respect to the determination of taxable
income, independent of any value the dollar might also have as a
commodity.” Id. at 1364. For this proposition, we relied upon
3This Court has consistently denied taxpayers deductions for
losses due to inflation and has repeatedly rejected the argument
that inflation is a proper ground for failing to report income.
See Sibla v. Commissioner, 68 T.C. 422, 430-431 (1977), affd. 611
F.2d 1260 (9th Cir. 1980); Gajewski v. Commissioner, 67 T.C. 181,
195 (1976), affd. without published opinion 578 F.2d 1383 (8th
Cir. 1978); Bartley v. Commissioner, T.C. Memo. 1998-322; Ruben
v. Commissioner, T.C. Memo. 1987-277; Downing v. Commissioner,
T.C. Memo. 1983-97; Warren v. Commissioner, T.C. Memo. 1982-696;
Notter v. Commissioner, T.C. Memo. 1982-96; Cunninghman v.
Commissioner, T.C. Memo. 1981-365; Milkowski v. Commissioner,
T.C. Memo. 1981-225; Crossland v. Commissioner, T.C. Memo. 1976-
59. Other courts have reached the same conclusions when faced
with similar situations. See Stelly v. Commissioner, 804 F.2d
868, 870 (5th Cir. 1986) (“The * * * [taxpayers’] contention that
they are entitled to an inflation adjustment to their interest
income is plainly incorrect.”); Birkenstock v. Commissioner, 646
F.2d 1185, 1186 (7th Cir. 1981) (“The market price of gold in
terms of dollars is * * * irrelevant to the determination of * *
* taxable income”), affg. T.C. Memo. 1979-201; Bates v. United
States, 108 F.2d 407, 408 (7th Cir. 1939) (attaching no
“significance to the statutory gold content of the dollar as a
factor in the determination of gain from the sale of capital
assets”); Daugherty v. United States, 1 Cl. Ct. 216, 218 (1983)
(taxpayer not entitled to “inflation factor” deduction).
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