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471 (1967). In that case, the Court held that the cost of
removing and replacing roof-covering material (as well as the
cost of inserting an expansion joint in the roof) was a
deductible expense. The Court observed that “it is necessary to
take into consideration the purpose for which an expenditure is
made in order to determine whether such expenditure is capital in
nature or constitutes a current expense.” Oberman Manufacturing
Co. v. Commissioner, supra at 482. The Court in Oberman
Manufacturing Co. observed that the taxpayer’s only purpose was
to prevent leakage and keep the leased property in an operating
condition over its probable useful life and not to prolong the
life of the property, increase its value, or make it adaptable to
another use. There was no replacement or substitution of the
roof. Petitioner’s only purpose in having the work done to the
roof was to prevent the leakage and keep her rental house in
operating condition and not to prolong the life of the property,
increase its value, or make it adaptable to another use. As in
Oberman Manufacturing Co., there was no replacement or
substitution of the roof. Petitioner’s expenditure merely
restored her rental house to one with a roof free of leaks. On
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