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Norm's car, which he uses 100% for personal purposes, was completely destroyed in an accident in 2010. The car's adjusted basis at the time of the accident was $13,000. Its fair market value was $11,500. The car was covered by a $2,000 deductible insurance policy. Norm did not file a claim against the insurance policy because of a fear that reporting the accident would result in a substantial increase in his insurance rates. His adjusted gross income was $14,000 (before considering the loss). What is Norm's deductible loss?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M971147

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