Jane bought an old mountain cabin as a second home and began to remodel it....
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Jane bought an old mountain cabin as a second home and began to remodel it. Immedately after she had removed the old appliances and cleaned the cabin, a fire destroyed it. The cost of the cabin was $100,000 (including $10,000 for the land. The fair market value (FMV of the property before the fire was $120,000. (105,000 for the building, and $15,000 for the land) After the fire, the FMV was $15,000 (value of the land) Jane collected $85,000 from the insurance company. Her casualty loss (before the $100 and 10% limits) is
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