In February 2018, the storage building used in Amelia's business is damaged by a windstorm. It had an adjusted basis of $150,000 at that time. Due to changing insurance companies, the building had been appraised recently, with a resulting FMV of $200,000. After the storm, the building appraised at $120,000. Amelia has received no insurance reimbursement by December 31, but expects to recover 90 percent of the loss. In the subsequent year, the insurance company pays Amelia $50,000. Amelia's AGI is $85,000 in 2018, and her 2019 AGI is $80,000. Amelia suffers no other casualty losses in either year. Amelia may deduct

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Amelia's deductible casualty loss in 2018 is calculated as the lesser of the decrease in FMV ($80,000) or the adjusted basis ($150,000), minus expected insurance recovery ($72,000), minus $100, and minus 10% of AGI ($8,500), resulting in an $8,000 deduction. In 2019, she receives $50,000 insurance, so she can deduct the remaining $22,000 of the loss.

In February 2018, the Storage Building Used in Amelia's Business