*2649 LOSS - DAMAGE BY STORM. - The extent of the loss sustained by petitioner in 1921 by reason of damage to her country estate from a violent ice, sleet and wind storm determined and the amount so found held to be subject to deduction by her from gross income for that year under section 214(a)(6) of the Revenue Act of 1921.
*65 This proceeding is in respect to a deficiency in income tax of $9,665.81 for the calendar year 1921, determined and advised of by *66 respondent on August 4, 1926, and resulting from the disallowance by respondent of a deduction taken by petitioner from gross income of $30,000 as damage sustained to her country estate, Greystone Farm, Dover, Mass., by a severe ice storm in that taxable year.
FINDINGS OF FACT.
Petitioner acquired by devise from her husband in 1920 and resides at Greystone Farms, Dover, Mass. This property is a valuable country estate of approximately 280 acres of land with a handsome residence, barns and other out buildings. This property when acquired by petitioner in 1920 had been improved at*2650 large expense through many years. Approximately 130 acres of the land surrounding the house had been elaborately parked and handscaped, the natural growth of many years having been utilized and developed and this added to by the planting and cultivating of many varieties of ornamental trees and shrubs. This portion of the estate was laid out in walks and drives bordered with various selected growths of trees and shrubs, and comprised fromal and informal gardens, ornamental plantations, orchards, lawns and artificial pools. Many of the trees were of exceptional perfection in size and symmetrical beauty and had been disposed at certain locations as part of the general plan of development and beautification of the estate. At this time and during the taxable year 1921 this development and elaborate landscaping had reached a high degree of perfection by reason of the care exercised and expense undergone for many years during which it had been in progress, the beauty of the landscaping plan and the final development and maturity of the ornamental growths. The balance of the estate consisted of 150 acres of natural woodland maintained in such state and containing a heavy growth of native*2651 trees of many varieties.
Beginning on November 27, 1921, and lasting for three days there occurred a sleet, rain and ice storm of unusual intensity causing large damage in the general vicinity of petitioner's estate. During this storm rain and sleet fell in considerable quantities and froze, causing the trees and shrubs to be coated with ice. High wind accompanied by the rain and sleet and the weight of the ice and the effect of this wind caused widespread damage to trees and shrubbery. On petitioner's estate this storm caused much damage. Many of the ornamental and fruit trees and shrubs were badly damaged and others were destroyed. Practically all of the trees and shrubs were broken and injured to some extent. In the 150 acres of woodland much damage was done to both the large and small trees, many being broken, split or uprooted.
Following this storm petitioner employed a firm of tree experts to clear away the debris, cut off broken limbs, treat the damaged trees *67 and to prune and trim them to restore, in so far as possible, their symmetry. During five years following the storm in question, this firm has worked toward restoring damage caused thereby, and during*2652 that time has been paid $7,534.50 for such work.
To restore in so far as possible all the damage done petitioner's estate by the storm would have cost $30,000. The damage done, considering the individual value of each tree and shrub, was in excess of $30,000. The fair market value of petitioner's estate when acquired by her and just before the storm in question was $110,000, and just after the storm was $80,000. This loss in value of $30,000 was due to the damage done by the storm.
OPINION.
TRUSSELL: By section 214(a)(6) of the Revenue Act of 1921 it is provided that in computing net income there shall be allowed as deductions:
(6) Losses sustained during the taxable year of property not connected with trade or business * * * if arising from fires, storm, shipwreck or other casualty or from theft, if not compensated for by insurance or otherwise. * * * In case of losses arising from destruction of or damage to property, where the property so destroyed or damaged was acquired before March 1, 1913, the deduction shall be computed upon the basis of its fair market price or value as of March 1, 1913.
Petitioner has appealed from respondent's disallowance of a deduction*2653 from gross income taken by her of $30,000 for the taxable year 1921 as damage sustained in that year to her country estate, as a result of an ice, sleet and wind storm.
One case has been before the Board and one before the courts involving deductions taken under authority of the section quoted, for damages to property arising from this same storm. In , we approved the action of the Commissioner in his disallowance of a deduction taken; this, however, being due to the fact that the damage claimed was not sufficiently proven for us to ascertain the amount. In , there was presented a case substantially similar to the one before us of damage to ornamental and fruit trees from the sleet, ice and wind. The court, in holding that the damage, if proven, was allowable under section 214(a)(6), said:
If however, the trees are fruit or ornamental trees or immature trees, they are of more value standing than felled, and the injury therefore goes beyond the mere destruction of the trees, it is an injury to the realty since the value of that is diminished by more than the value of*2654 the trees as timber, because the chief value is for productive or ornamental purposes. The measure of damages when ornamental or fruit-bearing trees or growing timber trees are cut is therefore the difference in value of the realty before and after the trespass.
The question we have here is one of fact, the extent of the loss in value of the estate due to the damage sustained. Upon this question *68 the evidence introduced by the petitioner is convincing. It is testified by competent witnesses, whose experience and knowledge of such matters are shown beyond question, that the reapir of the damage, in so far as repair was possible, could not be accomplished for less than $30,000, and that such repair would not bring the place back to the same point of perfection and beauty which it formerly had. It is further shown that, taking the damaged trees and shrubs separately, the total of the damage done to the individual value of each was largely in excess of this sum and, finally, it is shown to our satisfaction that the estate as a whole had a reasonable market value immediately before the storm of $110,000 and such value after the storm was not in excess of $80,000, the loss*2655 in value being due wholly to the damage done.
Petitioner is due a deduction of $30,000 from gross income for 1921 as a loss sustained by reason of this damage.
Judgment will be entered pursuant to Rule 50.