Reynaldo and Sonya, a married couple, had flood damage in their home due to a faulty water heater during 2014, which totally ruined the furniture that was stored in their garage. The following items were completely destroyed and not salvageable.

Their homeowner€™s insurance policy had a $10,000 deductible for the personal property, which was deducted from their insurance reimbursement of $12,700, resulting in a net payment of $2,700. Their AGI for 2014 was $40,000. What is the amount of casualty loss that Reynaldo and Sonya can claim on their joint return for 2014?

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Damaged Items Fair Market Value JustOriginal Item Cost (Basis) Antique poster bed Pool table Large screen T Prior to Damage $6,000 7,000 700 $5,000 11,000 2,500