Question
Reynaldo and Sonya, a married couple, had flood damage in their home due to a faulty water heater during 2016, which totally ruined the furniture
Reynaldo and Sonya, a married couple, had flood damage in their home due to a faulty water heater during 2016, which totally ruined the furniture that was stored in their garage. The following items were completely destroyed and not salvageable.
Damaged Items | Fair Market Value Just Prior to Damage | Original Item Cost (Basis) | ||||||||
Antique poster bed | $ | 6,000 | $ | 5,000 | ||||||
Pool table | 7,000 | 11,000 | ||||||||
Flat screen TV | 700 | 2,500 | ||||||||
Their homeowner's insurance policy had a $10,000 deductible for the personal property, which was deducted from their insurance reimbursement of $12,700, resulting in a net payment of $2,700. Their AGI for 2016 was $40,000. What is the amount of casualty loss that Reynaldo and Sonya can claim on their joint return for 2016?
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