Kevin James used a machine in his business, and it was partially destroyed by firE. At the time of the fire, the adjusted basis was $20,000 and the fair market value was $16,000. After the fire, the fair market value was $10,000. Kevin received $5,000 from his insurance company. How much is Kevin’s casualty loss deduction?

a.

$1,000

b.

$15,000

c.

None of these

d.

$6,000

e.

$900

$10,000