Determine his deductible loss on the SUV

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Question - Sammy had an accident in his SUV truck in 2019 in which the SUV was completely destroyed. Sammy used the car 50% of the time for business use and 50% of the time personal use. At the time of the accident, the SUV had a fair market value of $80,000 and an adjusted basis of $150,000 before taking $25,000 of accumulated depreciation into consideration. He received an insurance recovery of 50% of the value of the SUV at the time of the accident.

a. If Sammy's AGI for the year is $100,000 before consideration the accident, determine his deductible loss on the SUV, assuming a 10% floor for personal casualty loss.

b. Explain your answer in its entirety and SHOW ALL WORK.

Reference no: EM132978209

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