Christopher's residence was damaged by a storm during the administration of his estate. Christopher's executor paid $120,000 to repair the residence after the storm. Which of the following is a true statement?

Question

Quizplus · Accepted Answer

Christopher's estate paid for the repair of the residence, so the casualty loss would be deductible on the estate tax return, not on Christopher's individual income tax return. The executor can deduct the full amount of the loss, which in this case is $120,000. Option A is incorrect because a casualty loss cannot be deducted on an individual income tax return after death. Option B is partially correct, but the 10 percent limitation applies only to personal casualty losses claimed by the taxpayer during his lifetime, not to casualty losses claimed by a decedent's estate. Option D is incorrect because casualty losses are deductible on the estate tax return. Therefore, the correct answer is C.

Christopher's Residence Was Damaged by a Storm During the Administration