In 2017, Larry's Car, Which He Purchased Six Years Ago

Multiple Choice

In 2017, Larry's car, which he purchased six years ago for $6,000, was demolished in a traffic accident. As a result of the delay caused by this accident, Larry missed a business meeting and lost out on an important sale on which he could have earned a $1,200 commission. When he arrived home, he found his house had been broken into and his personal video equipment currently worth $3,200 (original cost = $5,000) had been stolen, along with his baseball card collection valued at $2,000 (basis = $1,500) . Larry's homeowner's policy covered only $3,000 of this theft loss. He had dropped the collision coverage on his auto insurance policy because that portion was too expensive, so he had no insurance coverage for his auto accident. His adjusted gross income is $82,000 and the fair market value of the car at the time of the accident was $8,000. How much can Larry deduct as an itemized deduction for his casualty and theft losses? If this occurred in 2018 (instead of 2017) , what amount is deductible?

A) zero in 2017 and 2018
B) $2,100; $3,700
C) $2,700; $2,100
D) $3,700; $2,700