On August $18$ of the tax year, Solomon's personal$-$use fishing boat sank off the coast of Florida due to a severe storm. The fair market value of the fishing boat before the casualty was $$55,000.$ He bought the boat five years earlier for $$40,000.$ His insurance company reimbursed him $$45,000.$ On October $2$ of the same year, he purchased a smaller boat for $$35,000.$ What is his recognized taxable gain for the year of the casualty?

 

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To calculate Solomons recognized taxable gain for the year of the casualty we ... View the full answer