Constance,who Is Single,is in an Automobile Accident in 2015,and Her

question 30

Multiple Choice

Constance,who is single,is in an automobile accident in 2015,and her car sustains $6,200 in damages.Because both drivers received tickets in the accident,Constance does not expect to recover any of the loss from her insurance company.Constance's 2015 AGI is $31,000.Her casualty loss is $3,000; she has other itemized deductions of $1,200.In 2016,Constance's insurance company reimburses her $2,800.Constance's 2016 AGI is $28,000.As a result,Constance must

• A)amend the 2016 return to show the $200 loss.
• B)do nothing and simply keep the $2,800.
• C)amend the 2015 return to show $0 loss and file her 2016 return to show $200 loss.
• D)do nothing to the 2015 return but report $2,800 of income on her 2016 return.

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Definitions:

Ethical Dilemma

A situation where a person faces a choice between two actions that are ethically challenging or conflict with moral imperatives.

Steal

The act of taking someone else's property without permission or legal right and with no intention of returning it.

Company

A legal entity formed by a group of individuals to engage in and operate a business commercial or industrial enterprise.

Basic Rights

Fundamental entitlements and freedoms that individuals are guaranteed by law or society, such as freedom of speech and right to privacy.