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

question 3

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

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Definitions:

Olive Oil

A liquid fat obtained from olives, used in cooking, cosmetics, pharmaceuticals, and soaps, and as a fuel for traditional oil lamps.

Imported

Refers to goods or services brought into one country from another.

Trading Bloc

Consists of those countries that have signed a particular trade agreement.

Trade Activities

Various operations and transactions involved in the buying, selling, or exchange of goods and services between businesses, countries, or entities.