"Mark Bole" <makbo[at]pacbell.net> wrote in message
news:Ty0ql.11553$pr6.9045[at]flpi149.ffdc.sbc.com...
- quote -

Based on the facts provided, I agree with the responses that stated
this is a personal and therefore non-deductible loss. However, if
there were a gain involved, this type of currency transaction gain
is ordinary income, not capital gain, regardless of holding period.

Also, just for a trip through the historical archives, I believe that
IRC 165 that Katie quoted has it's origins in WW II. Prior to the
U.S. becoming officially involved in the war effort in Europe,
American manufacturers were suffering tremendous losses in shipping
goods to Europe due to German U-Boats and none of the provisions
in the Code as it existed at the time allowed the losses. That's why
the provision for "shipwreck".

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removeps-groups[at]yahoo.com wrote:
- quote -

According to OP, there were six months between conversions. That
doesn't seem sudden, unexpected, or unusual, one of the hallmarks of a
casualty loss.

-Mark Bole

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >