5-44 Chapter 5 Itemized Deductions
EA
LO 5-5 63. Reynaldo and Sonya, a married couple, had flood damage in their home due to a
break near their home in 2023, which was declared a federally designated disaster.
The flood damage ruined the furniture that was stored in their garage. The following items
were completely destroyed and not salvageable:
Damaged Items
Antique poster bed
Pool table
Large flat-screen TV
FMV Just Prior to Damage
$6,000
7,000
700
Original Item Cost
$ 5,000
11,000
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
payment of $2,700. Their AGI for 2023 was $60,000. What is the amount of casualty loss
that Reynaldo and Sonya can claim on their joint return for 2023?
