514CCH Federal Taxation—Basic PrinciplesChapter 8 ©2010 CCH. All Rights Reserved.d. The overall 50% limitation considers the contribution amounts, not just the deduction amounts from the 61. percent limit deductions. The carryover would be $11,000.Contribution Amount% Limit Amounts% Limit Deductions50%$ 5,000$5,000$5,00030% Public12,0009,0009,00020%8,000--0----0--c. Inventory is ordinary income property and limited to basis in the charitable contribution computation. 62. b. Charitable contributions must be made to charities that are incorporated in the United States. 63. b. Private foundations are organizations which normally do not receive donations from the general public. 64. d. The reduction in fair market value is less than the basis; thus, that amount must be reduced by the 65. insurance proceeds, $100 and 10 percent of adjusted gross income because of the nonbusiness casualty loss.Fair market value before fire$80,000Less: Fair market value after fire40,000Decline in fair market value$40,000Less: Insurance proceeds15,000Less: Reduction100Less: 10% of AGI2,000Casualty loss deduction$22,900b. The deduction is $10,000 - $100 - $5,000 - $2,000 = $2,900.66. b. The deduction is computed as follows:67. Car wreck ($2,000 - $1,000 - $100)$900Theft of boat (deducted in year when theft discovered)$0Storm damage to lake house ($200,000 - $150,000 - $20,000 -$100)$29,900Total$30,80010% of AGI$6,000Net deduction$24,800d. Gambling winnings are reported as gross income and gambling losses are deductible to the extent of 68. winnings as itemized deductions. b. Unreimbursed expenses of employees are deductible from AGI.69.