- 15 -
F.2d 888, 890 (9th Cir. 1975), affg. T.C. Memo. 1973-258. An
important indication of the year of loss is the year that the
taxpayer loses control and possession of the property. United
States v. S.S. White Dental Manufacturing Co., 274 U.S. 398, 402
(1927).
Petitioners contend that the expropriation loss occurred in
1986 because (1) the Iranian government promised until 1986 to
restore the assets to the Elghanian family if they would return
to operate the business; (2) petitioner believed until the time
of the Iran-Contra affair in 1986 that the United States would
overthrow the Iranian government, enabling his family to recover
its property; and (3) petitioner had a reasonable prospect of
recovery until 1986.
We disagree. The Iranian government’s attempt to lure
members of petitioners’ family back to Iran was a hoax.
Petitioner’s belief that the United States would restore his
family’s property was remote, nebulous, and speculative. A loss
deduction is not postponed based on remote or nebulous
possibilities of recovery. Id. at 402-403. We conclude that the
loss did not occur in 1986, and, based on this record, that it
occurred in 1979, the year of the expropriation.10
10 Petitioners bear the burden of proof on the residence
and expropriation loss issues. Rule 142(a); Welch v. Helvering,
290 U.S. 111, 115 (1933). The burden of proof for a factual
issue may shift to the Commissioner under certain circumstances.
(continued...)
Page: Previous 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 NextLast modified: May 25, 2011