In 2017, Grant's personal residence was completely destroyed by fire.Grant was insured for 100% of his actual loss, and he received the insurance settlement.Grant had adjusted gross income, before considering the casualty item, of $30,000.Pertinent data with respect to the residence follows: $$\begin{array} { l r }
\text { Cost basis } & \$ 280,000 \
\text { Value before casualty } & 250,000 \
\text { Value after casualty } & - 0 -
\end{array}$$ What is Grant's allowable casualty loss deduction?

Question

In 2017, Grant's personal residence was completely destroyed by fire.Grant was insured for 100% of his actual loss, and he received the insurance settlement.Grant had adjusted gross income, before considering the casualty item, of $30,000.Pertinent data with respect to the residence follows: $$\begin{array} { l r } 
\text { Cost basis } & \$ 280,000 \
\text { Value before casualty } & 250,000 \
\text { Value after casualty } & - 0 -
\end{array}$$ What is Grant's allowable casualty loss deduction?

Quizplus · Accepted Answer

Since Grant was insured for 100% of his actual loss and received the insurance settlement, he does not have an allowable casualty loss deduction. The insurance compensation covers his entire loss.

In 2017, Grant's Personal Residence Was Completely Destroyed by Fire