A taxpayer loaned $2,000 to her best friend in 2019. The friend filed for bankruptcy in 2020 at which time the taxpayer was told to expect to receive $.60 on the dollar on this personal loan. On February 2, 2021, the taxpayer received a final settlement of $950. How much can the taxpayer deduct in 2020 and 2021, and how will the loss be treated on the return? 1) 2020: $800 short-term capital loss; 2021: $250 short-term capital loss 2) 2020: $0; 2021: $1,050 short-term capital loss 3) 2020: $800 long-term capital loss; 2021: $250 long-term capital loss 4) 2020: $0; 2021: $1,050 long-term capital loss 5) None of the above