Reynaldo and Sonya, a married couple, had flood damage in their home due to a dam break near their home in 2021, which wasdeclared a Federally Designated Disaster Area. The flood damage ruined the furniture that was stored in their garage. The followingitems were completely destroyed and not salvageable:Damaged ItemsAntique poster bedPool tableLarge flat-screen TVFMV Just Prior Original ItemCost (Basis)$ 6,10014,0254,425Casualty loss deductionto Damage$ 8,2008,3751,250Required:Their homeowner's insurance policy had a $11,485 deductible for the personal property, which was deducted from their insurancereimbursement of $15,725, resulting in a net payment of $4,240. Their AGI for 2021 was $45,000. What is the amount of casualty lossthat Reynaldo and Sonya can claim on their joint return for 2021?

Damaged itemsFMV just prior to damage (a)Original item cost (basis) (b)Actual loss (Lesser of a or…

Answered: Reynaldo and Sonya, a married couple,…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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-Betty is an unmarried attorney. During the year a hurricane completely destroys her home, which had a basis of $60,000. The value of her home before the tornado is $100,000 and the value afterwards is $35,000. Betty's home is located in a federally declared natural disaster area. Her AGI is $50,000. What is the amount that Betty can deduct after limitations? Group of answer choices $29,900. $54,900. $59,900. $65,000.

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