Exercise 6-4 (Algorithmic) (LO. 3) Noelle's diamond ring was stolen in 2017. She originally paid $10,900 for the ring, but it was worth considerably more at the time of the theft. Noelle filed an insurance claim for the stolen ring, but the claim was denied. Because the insurance claim was denied, Noelle took a casualty loss deduction for the stolen ring on her 2017 tax return. In 2017, Noelle had AGI of $54,500. After Noelle threatened legal action in early 2021, the insurance company had a "change of heart" and sent Noelle a check for $6,540 for the stolen ring. The per-event floor is $100. What is the proper tax treatment of the $6,540 Noelle received from the insurance company in 2021? Noelle should include as income in 2021 the amount of $ 43,700 X. Feedback Check My Work Theft includes, but is not necessarily limited to, larceny, embezzlement, and robbery. Theft does not include misplaced items. Theft losses are computed like other casualty losses, but the timing for recognition of the loss differs. Note: In general, losses on personal use property (e.g., a car, furniture, or a residence) are not deductible. The casualty loss rules are an exception. However, from 2018 through 2025, a taxpayer can take a deduction for a personal casualty or theft loss only if the loss occurs in a Federally declared disaster area