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loss deduction. The amount of the damage is the lesser
of either (1) the difference between the fair market
value of the property immediately before and
immediately after the casualty, or (2) the adjusted
basis of the property. That amount reduced by $100 is
allowable as a casualty loss deduction.
The Commissioner has neither revoked nor modified Rev. Rul.
70-91, supra.4 Revenue rulings are not binding on this Court, or
other Federal courts for that matter. Rauenhorst v.
Commissioner, 119 T.C. 157, 171 (2002). However, they may serve
to bind the Commissioner in cases in which a longstanding revenue
ruling that has not been revoked or modified is relevant to our
disposition of the case. Id. at 173. Under such circumstances,
we have treated the revenue ruling as a concession by the
Commissioner. Id. at 171-173.
Such treatment of Rev. Rul. 70-91 is warranted in the
present case. We conclude that the dichotomy expressed in the
revenue ruling comports with the casualty loss provisions of
section 165. Based on this conclusion, we hold that petitioner
is entitled to a casualty loss deduction for water damage to her
house and personal belongings to the extent substantiated.5
Substantiation of Loss
Petitioner presented varied disorganized records to
substantiate the loss. Likewise her testimony was often vague
4 Indeed, the Commissioner has relied upon it in issuing a
private letter ruling. See Priv. Ltr. Rul. 8341012 (July 7,
1983).
5 Any claimed loss to the washing machine hose connection
would not be allowable, nor does the record reveal a separate
claim for such loss.
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