One point in the Patel case is the opening paragraph where it is stated as a fact that the property was purchased "with the intention to demolish" the structure. Under Generally Accepted Accounting Principles (and presumably also tax accounting) that would allocate $0 costs to the building, giving nothing to claim as a deduction. However, I'm more swayed by the donation of a less than full interest argument.
There are several cases on this issue prior to Patel and, as you note, I doubt Patel is the definitive answer as such contributions can be substantial. In Patel, it was $339,000 before limitation, making it worth a Tax Court fight to try to sustain them.
