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The answer lists nine affirmative defenses, most of which follow
along the lines of the reasons for denial provided in the denial
letter. The lawsuit was eventually settled by agreement of all
the parties thereto.7 In the settlement, no party admitted or
conceded liability, and no damages were awarded.
The western portion of the south building was torn down in
1996. The middle and eastern portions of the south building were
not torn down.
Petitioner filed his 1994 Federal income tax return (the
1994 return) on April 26, 1996. The 1994 return was due to be
filed on October 15, 1995. Petitioner’s accountant, Charles
Finder, began preparing the 1994 return sometime in 1995. In
November or December 1995, petitioner gave Mr. Finder a document
for use in preparing the 1994 return. This document provides
brief descriptions of some of the buildings on the Property, and
claims that two masonry buildings, exceeding 50 years of age and
with a combined value of approximately $154,000, were damaged by
the collapse in 1994. It further claims that the value of the
damaged buildings after the collapse was zero. Mr. Finder relied
on the document in preparing the 1994 return. On Form 4684,
Casualties and Thefts, of the 1994 return, petitioner claimed a
casualty loss in connection with the collapse. The Form 4684
7 The record does not disclose the date of the settlement.
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