Problem:
Tim suffered greatly this year. In January a freak storm damaged his sailboat and in July Tim's motorcycle was stolen from his vacation home. Tim originally paid $28,200 for the boat, but he was able to repair the damage for $10,050. Tim paid $18,550 for the motorcycle, but it was worth $20,350 before it was stolen. Insurance reimbursed $1,200 for the boat repairs and the cycle was uninsured
Required:
Question 1: Calculate Tim's deductible casualty loss if his AGI is $50,000.
Question 2: Calculate Tim's deductible casualty loss if his AGI is $150,000.
Question 3: How would you answer a. if Tim received an additional $65,000 in interest from municipal bonds this year?
Note: Be sure to show how you arrived at your answer.