Olaf lives in the state of Minnesota. In $2022,$ a tornado hit the area and damaged his home and automobile. Applicable information is as follows:

Item Adjusted

Basis FMV

Before FMV

After Insurance

Proceeds

Home $$350,000$ $$500,000$ $$100,000$ $$280,000$

Auto $60,00040,00010,00020,000$

Because of the extensive damage caused by the tornado, the President designated the area a Federal disaster area.

Olaf and his wife, Anna, always file a joint return. Their $2021$ tax return shows AGI of $$180,000$ and taxable income of $$145,000.$ In $2022,$ their return shows AGI of $$300,000$ and taxable income $($exclusive of the casualty loss deduction$)$ of $$245,000.$

Assume the taxpayers are in the $22\%$ tax bracket in $2021$ and the $24\%$ tax bracket in $2022.$

Determine the amount of Olaf and Anna's loss and the year in which they should take the loss.

Item Amount of Loss

Home $fill in the blank $1$

Auto fill in the blank $2$

Total loss $fill in the blank $3$

Less: statutory floor amount fill in the blank $4$

Loss before statutory $\%$ of AGI $fill in the blank $5$

Amount of loss on last year's return:

Loss $fill in the blank $6$

Less: statutory $\%$ of AGI fill in the blank $7$

Total loss $fill in the blank $8$

Amount of loss on current year's return:

Loss $fill in the blank $9$

Less: statutory $\%$ of AGI fill in the blank $10$

Total loss $fill in the blank $11$

Olaf and Anna should include the loss on the

return, because the tax savings is greater.