Gomez, a Self-Employed Consultant, Is Involved in a Traffic Accident

Multiple Choice

Gomez, a self-employed consultant, is involved in a traffic accident with his business-use automobile. The car is totally destroyed and Gomez's insurance policy reimburses him $8,000 for the fair market value of the car immediately before the accident. His basis in the car is $11,000. What is the amount of Gomez's casualty loss deduction?

A) $- 0 -
B) $ 2,000
C) $ 3,000
D) $ 8,000
E) $11,000