Jim had a car accident in2019 in which his car was completely destroyed. At the time of the accident, the car had a fair market value of $30,000 and an adjusted basis of $40,000. Jim used the car 100% of the time for business use. He received an insurance recovery of 70% of the value of the car at the time of the accident. If Jim’s AGI for the year is $60,000, determine his deductible loss on the car.
A. $900
B. $2,900
C. $3,000
D. $9,000
E. None of these.
Answer: E
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